Book Hack
How Finance WorksBy Mihir Desai

In a Nutshell

Professor Mihir Desai of Harvard Business School guides you through the complicated world of finance in clear and simple terms.

Favorite Quote

Capital markets and finance are all about information and incentives, not money. Finance, at its heart, is trying to solve the deepest problem in modern capitalism – the principal-agent problem, or the separation of ownership and control.

Mihir Desai

Introduction

The world of finance can appear exclusive and mysterious to outsiders.

But understanding finance is vital for anyone hoping to have a career in business, and helpful for many other careers as well, since finance is the lifeblood of the world economy.

Mihir Desai is a professor at the Harvard Business School and an advisory board member at the International Tax Policy Forum.

In this book, Desai illuminates the central principles of finance for a general audience through real-world examples, exercises, and interviews with financial experts.

How Finance Works covers how companies pay for their operations and investments, why cash flow is emphasized over profits, how value is created, measured, and maximized, and how capital markets drive companies' growth.

Here are the 3 key insights from this Hack

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    Finance is more about information and incentives than money
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