Saving Private Business Enterprises
01 Apr 2013-The American Journal of Economics and Sociology (John Wiley & Sons, Ltd)-Vol. 72, Iss: 2, pp 447-467
TL;DR: This paper argued that market governance by the business enterprise and market regulation by the state are purposeful and necessary actions to save private business enterprises vis-a-vis fundamental instability inherent in the capitalist system.
Abstract: This article develops an argument from a heterodox microeconomic perspective that the business enterprise and the state have to control market institutions in order to protect the vested interests of the ruling class. Market governance by the business enterprise and market regulation by the state are in this regard purposeful and necessary actions to save private business enterprises vis-a-vis fundamental instability inherent in the capitalist system.
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TL;DR: In this paper, the authors argue that the government protects the incomes and assets of financial institutions, but it does little to protect the incomes or assets of households, which are necessary for people to afford healthcare, education, emergencies, retirement, and so on.
Abstract: :Financialization challenges Karl Polanyi’s thesis of double movement, the thesis that efforts to extend the market evoke efforts to protect humans, nature, and means of production from market forces. Financialization refers to the increased power of financial institutions. The government protects the incomes and assets of financial institutions, but it does little to protect the incomes and assets of households, which are necessary for people to afford healthcare, education, emergencies, retirement, and so on. Polanyi criticized nineteenth-century civilization for transforming land, labor, and the means of production into commodities, using economic insecurity to motivate humans. The development of intangible property allowed business to expand the market in two ways: (i) restricting output to drive up profits and (ii) liquefying consumer assets to provide credit to consumers to increase spending. The implications of that process manifested themselves in the financial crisis of 2008. Market capit...
10 citations
Posted Content•
TL;DR: In this paper, the authors argue that market institutions are created and controlled by business enterprises and the state, competition and cooperation among business enterprises are two sides of the same coin, competition is regulated, and hence, market instability is managed, if not eliminated, by those who control the market.
Abstract: Grounded in the methodological commitments shared by various traditions in heterodox economics, this paper explores going enterprises’ cooperative actions to control markets through social networks. It is argued that 1) market institutions are created and controlled by business enterprises and the state, that 2) competition and cooperation among business enterprises are two sides of the same coin, that 3) competition is regulated, and hence that 4) market instability is managed, if not eliminated, by those who control the market. Such arguments lead to the managed competition thesis that encompasses corporate governance, market governance, and market regulation in an integrative manner.
7 citations
Cites background from "Saving Private Business Enterprises..."
...It is the interactions or often cooperations between dominant agents of the time that control and, hence, reproduce or transform the market (Veblen 1923; Kolko 1963; Eichner 1969; Meyer 1986; Fligstein 1990; 2001; Prechel 2000; Rosenberg 2001; Jo 2011b; 2013; Lee 2012)....
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...For this issue, see Lee and Jo (2013)....
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TL;DR: More than 150 years ago, Marx predicted that the working class would become the gravedigger of capitalism, a seemingly prescient prediction as socialism flourished between the two World Wars as discussed by the authors.
Abstract: More than 150 years ago, Marx predicted that the working class would become “the gravedigger of capitalism,” a seemingly prescient prediction as socialism flourished between the two World Wars. How...
2 citations
01 Jan 2015
TL;DR: The writings of the "muckrakers" informed and mobilized the general public to action regarding unfair business practices and corrupt political elites as mentioned in this paper, leading to significant changes in the American political, economic, and cultural landscape.
Abstract: Thorstein Veblen witnessed significant changes in the American political, economic, and cultural landscape. Industrialization replaced agriculture as the primary source of income for the American economy. Urban population centers flourished, and across the country, politicians debated social justice initiatives. The writings of the ‘muckrakers’ informed and mobilized the general public to action regarding unfair business practices and corrupt political elites. Veblen also witnessed the rise of the corporation and spread of unprecedented economic disparities.
1 citations
References
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Book•
01 Jan 1932
TL;DR: Weidenbaum and Jensen as mentioned in this paper reviewed the impact of developments not fully anticipated by Berle and Means, such as the rise of the service sector, and the significant role played by institutional investors in the owner/manager equation.
Abstract: This monumental work on the corporation is one of those enduring classics that many cite but few have read. Graced with a new introduction by Weidenbaum and Jensen, this new edition makes this classic available to a new generation. Written in the early 1930s, The Modern Corporation and Private Property remains the fundamental introduction to the internal organization of the corporation in modern society. Combining the analytical skills of an attorney with those of an economist, Berle and Means raise the central questions, even when their answers have been superseded by changing circumstances. The book's most enduring theme is the separation of ownership from control of the modern corporation and its consequences. Berle and Means display keen awareness of the divergent interests of directors and managers, and of each from owners of the firm. Among their predictions are the characteristic increase in size of the modem corporation and concentration of the economy. The authors view stock exchanges and stock markets as essential by-products of the rise of the modem corporation, and explore how these function. They address the difficult questions of whether corporations operate for the benefit of owners or managers, and explore what motivates managers to make effective use of corporate assets. Finally, they examine the role of the corporation as the prevailing form of organizing the production and distribution of goods and services. In their new introduction, Weidenbaum and Jensen, co-directors of the Center for the Study of American Business at Washington University, critically assess the impact of developments not fully anticipated by Berle and Means, such as the rise of the service sector, and the significant role played by institutional investors in the owner/manager equation. They note the authors' prescient observations, including the complex role of and motivating influences on professional managers, and the significance of inside information on stock markets. As they note, The Modern Corporation and Private Property remains of central value to all those concerned with the evolution of this major social institution of the twentieth century. Scholar and practitioner alike will find it of enduring significance.
10,159 citations
Book•
01 Jan 1967
TL;DR: The new industrial state, The new industrial states, this article, is a state of the new industrial world, which is the industrial state of Iran, in which all goods and services must be exported.
Abstract: The new industrial state , The new industrial state , کتابخانه دیجیتال و فن آوری اطلاعات دانشگاه امام صادق(ع)
2,681 citations
TL;DR: In the past two decades, the ideology of shareholder value has become entrenched as a principle of corporate governance among companies based in the United States and Britain this article and has become prominent in the corporate governance debates in European nations such as Germany, France and Sweden.
Abstract: Over the past two decades the ideology of shareholder value has become entrenched as a principle of corporate governance among companies based in the United States and Britain. Over the past two or three years, the rhetoric of shareholder value has become prominent in the corporate governance debates in European nations such as Germany, France and Sweden. Within the past year, the arguments for ‘maximizing shareholder value’ have even achieved prominence in Japan. In 1999 the OECD issued a document, The OECD Principles of Corporate Governance, that emphasizes that corporations should be run, first and foremost, in the interests of shareholders (OECD, 1999)
1,533 citations
TL;DR: The assumption that a government will maintain full employment in a capitalist economy if it only knows how to do it is fallacious as mentioned in this paper, and the misgivings of big business about maintenance of full employment by Government spending are of paramount importance.
Abstract: First, Kalecki's affirmation that full employment adversely affect profits represents a radical departure from the classical Marxist theoretical tradition within which he wrote. Indeed, the argument that profits undergo a wage-induced decline during an economic upswing actually reinforces Kalecki's basic thesis that full employment is not generally in the interest of business. The assumption that a Government will maintain full employment in a capitalist economy if it only knows how to do it is fallacious. In this connection the misgivings of big business about maintenance of full employment by Government spending are of paramount importance. The attitude was shown clearly in the great depression in the thirties, when big business opposed consistently experiments for increasing employment by Government spending in all countries, except Nazi Germany. And the policy of full employment based on loan financed Government spending does not encroach upon profits because it does not involve any additional taxation.
1,017 citations