Are Share Buybacks Bad For Energy Innovation?

The most recent issue of the McKinsey Quarterly includes an interesting analysis of the impact of share buybacks and dividends on long-term economic growth.

Returning cash to shareholders is on the rise for large US-based companies. By McKinsey’s calculations, share buybacks alone have increased to about 47 percent of the market’s income since 2011, from about 23 percent in the early 1990s and less than 10 percent in the early 1980s. Some investors and legislators have wondered whether that increase is tantamount to underinvestment in assets and projects that represent future growth.

McKinsey’s answer: “It isn’t.”

grabbed from http://www.forbes.com/sites/williampentland/2015/10/30/are-share-buybacks-bad-for-energy-innovation/