Who Pays for ESOP Shares?

This is an old paper (1980s) analyzing the American Employee Stock Ownership Plan or ESOP. The original proposer of the ESOP idea, Louis Kelso, and his ardent follows have shrouded the ESOP transactions in such a cloud of rhetoric, that one needs to independently perform an analysis to see what is really going on. The paper was never published (except in this website version) since I had no reason to publicly attack ESOPs, only to be clear about them and their true institutional contribution–which is considerable.