Archive for the ‘business and governance’ Category

the sociology of worker ownership – guest post by adria scharf

In this guest post, Adria Scharf, director of the Curriculum Library for Employee Ownership, invites you to watch a video workshop that can help inform research, course syllabi, reading lists, and work with practitioners.  Read on for more info, including a special Q&A session at the 2020 ASA meeting.

“The Sociology of Worker Ownership

“Worker ownership” offers both an alternative to the dominant capitalist model of the employment relationship and a means to broaden the ownership of wealth in society.

In this video workshop, “The Sociology of Worker Ownership: New Data Sets and Research Approaches,” leading researchers introduce datasets and research approaches to study worker ownership and its effects:

The video opens with comments from Joyce Rothschild and Joseph Blasi, and is moderated by Adria Scharf.  Janet Boguslaw, Laura Hanson Schlachter, Nancy Weifek, and Joseph Blasi present data sets and research. Sarah Reibstein also contributed.

Alternatively, you can view the video (automatic cc: available) here:

This Research & Policy Workshop was developed for the 2020 Annual Meeting of the ASA.  A live Q&A with the presenters will take place at the 2020 ASA virtual annual meeting on Tues., August 11th at 5:30 EDT.

Find a list of several datasets, with information on how to access them, here:


Written by katherinechen

August 4, 2020 at 6:46 pm

extended q & a with daniel beunza about taking the floor: models, morals, and management in a wall st. trading room

Following 9/11, Wall St. firms struggled to re-establish routines in temporary offices.  Many financial firms subsequently made contingency plans by building or renting disaster recovery sites.   As we see now,  these contingency plans relied upon certain assumptions that did not anticipate current pandemic conditions:

The coronavirus outbreak threw a wrench into the continuity planning that many Wall Street companies had put in place since at least the Sept. 11 terrorist attacks. Those plans were largely built around the idea that if trading at a bank headquarters was knocked off-line, groups of traders would decamp to satellite trading floors outside the radius of whatever disaster had befallen New York. But those plans quickly became unworkable, given the dangers of infections from coronavirus for virtually all office work that puts people close to one another.

“This is really not the disaster that they had planned for,” said Daniel Beunza, a business professor at the City University of London, who has studied and recently written a book on bank trading floor culture.


Just in time for us to understand the importance of face-to-face proximity in the workplace, Beunza has a new book Taking the Floor: Models, Morals, and Management in a Wall Street Trading Room (2019, Princeton University Press) based on years of ethnographic observation. Beunza kindly agreed to an extended Q&A about his research.

Q: “Chapter 1 of your book describes how you were able to gain access to an organization, after two failed attempts.  Quinn, a classmate, offers to introduce you to a former co-worker of his from finance: Bob, now the head of a derivatives trading floor at International Securities.  You meet with Bob and observe activities, where you realize that the trading floor no longer looks or sounds like prior literature’s depictions.  After this first meeting, you send over “sanitized” field notes about your first visit (p. 32), and you meet again with Bob, who has even read and reflected on these field notes. This second meeting to go over your initial impressions starts a longer relationship between yourself and this unit of International Securities [a pseudonym].  You have your own desk on the floor, where you can write down notes​.  

In subsequent years, after the bulk of your field research ends, you invite Bob to come as a guest speaker in your Columbia Business School classes.  Your book recounts how bringing in Bob not only offers the MBA finance students perspective on their desired field of employment, but might also smooth over student-professor relations, especially since teaching evaluations matter.  Afterwards, Bob comments on the students’ late arrivals to class and how he handled the equivalent in his workplace, helping you to understand divergences in your respective approaches to relationships and organizations. 

In chapter 8, your book describes your interview with Peter, an executive who had worked with Bob at International Securities.  Peter describes how most Wall Streeters might react to researchers’ requests for access:

“Bob is a curious dude.  He reads a lot.  He befriended you because he was curious. Most guys on Wall Street would say, ‘Oh, another academic from Columbia?  Thank you very much.  Goodbye.  I don’t have time for you.  You’re going to teach me a new algorithm? You’re going to teach me something big?  Okay.  Come in and sit down.  And I’ll pay you, by the way.’  But a sociologist?  ‘Wrong person on my trading floor.  A desk?  No.  You’re crazy.  Go away.’ So Bob has those qualities, and many of the people you see here have those qualities” (p. 168).

Peter’s comment, along with your observations, also offers a colleague’s assessment of Bob’s management style.  Rather than relying on money as an incentive or fear as a motivation, Bob hires people ‘who were a little different,’ and he cultivates relationships by spending time with employees during work hours in supportive and subtle ways, according to Peter.  (Elsewhere, your book notes that this does not extend to colleagues having drinks outside of work – a way that other organizations can cultivate informal relations.)  

 Your book argues that such practices, when coupled with clearly communicated values delineating permissible and impermissible actions, constitute “proximate control.” Such efforts can check potential “model-based moral disengagement” where parties focus on spot transactions over longer-term relationships; this focus can damage banks’ viability and legitimacy.  In other words, your book posits that face-to-face contact can channel decisions and actions, potentially reigning in the damaging unknown unknowns that could be unleashed by complex financial models.

 First, the content question:

These analyses remind me of older discussions about managerial techniques (notably, Chester Barnard, who built upon Mary Parker Follet’s ideas) and mantras (Henri Fayol’s span of control), as well as more recent ones about corporate culture.  Indeed, your book acknowledges that Bob’s “small village” approach may seem “retro” (p. 170).

That said, your book underscores how people and organizations still benefit from face-to-face connection and interdependency.  Some workplaces increasingly de-emphasize these aspects, as work has become virtually mediated, distributed, asynchronous, etc.  Why and how does it matter so much more now?  How are these findings applicable beyond the financial sector​?”

Beunza: “Face-to-face connections are crucial, but I should add that the perspective coming out of the book is not a luddite rejection of technology. The book makes a sharp distinction between valuation and control. The use of models to value securities is in many ways a more advanced and more legitimate way of pursing advantage on Wall Street than alternatives such as privileged information.

However, the use of models for the purpose of control raises very serious concerns about justice in the organization. Employees are quickly offended with a model built into a control tool penalizes them for something they did correctly, or allows for gaming the system. If perceptions of injustice become recurring, there is a danger that employees will morally disengage at work, that is, no longer feel bad when they breach their own moral principles. At that point, employees lose their own internal moral constraints, and become free to pursue their interests, unconstrained. That is a very dangerous situation.

I would argue this is applicable to all attempts at mechanistically controlling employees, including other industries such as the Tech sector, and not-for-profit sectors such as academia. Some of the warmest receptions of my book I have seen are by academics in the UK, who confront a mechanistic Research Assessment Exercise that quantifies the value of their research output.”

Q: “Second, the reflexivity question:

Did you anticipate how Bob’s visit to your Columbia Business School classroom might provide additional insight into your own “management” [facilitation?] style and your research regarding financial models and organizations?  How have research and teaching offered synergistic boosts to respective responsibilities?  How do such cross-over experiences – discussing issues that arise in researcher’s organizations, which probably constitute “extreme” cases in some dimensions – help with developing organizational theory?”

Beunza: “Back in 2007, I had a diffuse sense that I would learn something of significance when inviting Bob to my classroom, but was not sure what. Before I saw him, I suspected that my original view of him as a non-hierarchical, flat-organization type of manager might not quite be entirely accurate, as a former colleague of him said he was a “control freak.” But I had no way of articulating my doubts, or take them forward. His visit proved essential in that regard. As soon as he showed up and established authority with my unruly students, I understood there was something I had missed in my three years of fieldwork. And so I set out to ask him about it.

More generally, my teaching was instrumental in understanding my research. MBA students at Columbia Business School did not take my authority for granted. I had to earn it by probing, questioning, and genuinely illuminating them. So, I develop a gut feeling for what authority is and feels like. This helped me understand that asking middle managers to abdicate their decisions in a model (which is what the introduction of quantitative risk management entailed in the late 90s) is a fundamental challenge to the organization.”

Q: “This, a methods question:

Peter’s comment underscores what Michel Anteby (2016) depicts as “field embrace” – how an organization welcomes a researcher – as opposed to denying or limiting access.  Anteby notes how organizations react to researchers’ requests to access is a form of data.  How did Bob’s welcoming you and continued conversations over the years shed additional insight into your phenomena?”

Beunza: “Anteby is right that the bank’s form of embrace is data. Indeed, I could not quite understand why International Securities embraced my presence in the early 2000s until 2015, when Bob laid out for me the grand tour of his life and career, and allowed me to understand just how much of an experiment the trading floor I had observed was. Bob truly needed someone to witness what he had done, react back to it, accept or challenge the new organization design. And this was the most fundamental observation of the research process – the one that motivates the book. My entire book is an answer to one question, “how did Bob’s experiment perform?” that I could only pose once I understood why he had embraced my presence.”

————– Read more after the jump ———— Read the rest of this entry »

book spotlight: beyond technonationalism by kathryn ibata-arens

At SASE 2019 in the New School, NYC, I served as a critic on an author-meets-critic session for Vincent de Paul Professor of Political Science Kathryn Ibata-Arens‘s latest book, Beyond Technonationalism: Biomedical Innovation and Entrepreneurship in Asia.  


Here, I’ll share my critic’s comments in the hopes that you will consider reading or assigning this book and perhaps bringing the author, an organizations researcher and Asia studies specialist at DePaul, in for an invigorating talk!

“Ibata-Arens’s book demonstrates impressive mastery in its coverage of how 4 countries address a pressing policy question that concerns all nation-states, especially those with shifting markets and labor pools.  With its 4 cases (Japan, China, India, and Singapore),  Beyond Technonationalism: Biomedical Innovation and Entrepreneurship in Asia covers impressive scope in explicating the organizational dimensions and national governmental policies that promote – or inhibit – innovations and entrepreneurship in markets.

The book deftly compares cases with rich contextual details about nation-states’ polices and examples of ventures that have thrived under these policies.  Throughout, the book offers cautionary stories details how innovation policies may be undercut by concurrent forces.  Corruption, in particular, can suppress innovation. Espionage also makes an appearance, with China copying’s Japan’s JR rail-line specs, but according to an anonymous Japanese official source, is considered in ill taste to openly mention in polite company. Openness to immigration and migration policies also impact national capacity to build tacit knowledge needed for entrepreneurial ventures.  Finally, as many of us in the academy are intimately familiar, demonstrating bureaucratic accountability can consume time and resources otherwise spent on productive research activities.

As always, with projects of this breadth, choices must made in what to amplify and highlight in the analysis.  Perhaps because I am a sociologist, what could be developed more – perhaps for another related project – are highlighting the consequences of what happens when nation-states and organizations permit or feed relational inequality mechanisms at the interpersonal, intra-organizational, interorganizational, and transnational levels.  When we allow companies and other organizations to, for example, amplify gender inequalities through practices that favor advantaged groups over other groups, what’s diminished, even for the advantaged groups?

Such points appear throughout the book, as sort of bon mots of surprise, described inequality most explicitly with India’s efforts to rectify its stratifying caste system with quotas and Singapore’s efforts to promote meritocracy based on talent.  The book also alludes to inequality more subtly with references to Japan’s insularity, particularly regarding immigration and migration. To a less obvious degree, inequality mechanisms are apparent in China’s reliance upon guanxi networks, which favors those who are well-connected. Here, we can see the impact of not channeling talent, whether talent is lost to outright exploitation of labor or social closure efforts that advantage some at the expense of others.

But ultimately individuals, organizations, and nations may not particularly care about how they waste individual and collective human potential.  At best, they may signal muted attention to these issues via symbolic statements; at worst, in the pursuit of multiple, competing interests such as consolidating power and resources for a few, they may enshrine and even celebrate practices that deny basic dignities to whole swathes of our communities.

Another area that warrants more highlighting are various nations’ interdependence, transnationally, with various organizations.  These include higher education organizations in the US and Europe that train students and encourage research/entrepreneurial start-ups/partnerships.  Also, nations are also dependent upon receiving countries’ policies on immigration.  This is especially apparent now with the election of publicly elected officials who promote divisions based on national origin and other categorical distinctions, dampening the types and numbers of migrants who can train in the US and elsewhere.

Finally, I wonder what else could be discerned by looking into the state, at a more granular level, as a field of departments and policies that are mostly decoupled and at odds. Particularly in China, we can see regional vs. centralized government struggles.”

During the author-meets-critics session, Ibata-Arens described how nation-states are increasingly concerned about the implications of elected officials upon immigration policy and by extension, transnational relationships necessary to innovation that could be severed if immigration policies become more restrictive.

Several other experts have weighed in on the book’s merits:

Kathryn Ibata-Arens, who has excelled in her work on the development of technology in Japan, has here extended her research to consider the development of techno-nationalism in other Asian countries as well: China, Singapore, Japan, and India. She finds that these countries now pursue techno-nationalism by linking up with international developments to keep up with the latest technology in the United States and elsewhere. The book is a creative and original analysis of the changing nature of techno-nationalism.”
—Ezra F. Vogel, Harvard University
“Ibata-Arens examines how tacit knowledge enables technology development and how business, academic, and kinship networks foster knowledge creation and transfer. The empirically rich cases treat “networked technonationalist” biotech strategies with Japanese, Chinese, Indian, and Singaporean characteristics. Essential reading for industry analysts of global bio-pharma and political economists seeking an alternative to tropes of economic liberalism and statist mercantilism.”
—Kenneth A. Oye, Professor of Political Science and Data, Systems, and Society, Massachusetts Institute of Technology
“In Beyond Technonationalism, Ibata-Arens encourages us to look beyond the Asian developmental state model, noting how the model is increasingly unsuited for first-order innovation in the biomedical sector. She situates state policies and strategies in the technonationalist framework and argues that while all economies are technonationalist to some degree, in China, India, Singapore and Japan, the processes by which the innovation-driven state has emerged differ in important ways. Beyond Technonationalism is comparative analysis at its best. That it examines some of the world’s most important economies makes it a timely and important read.”
—Joseph Wong, Ralph and Roz Halbert Professor of Innovation Munk School of Global Affairs, University of Toronto
Kathryn Ibata-Arens masterfully weaves a comparative story of how ambitious states in Asia are promoting their bio-tech industry by cleverly linking domestic efforts with global forces. Empirically rich and analytically insightful, she reveals by creatively eschewing liberalism and selectively using nationalism, states are both promoting entrepreneurship and innovation in their bio-medical industry and meeting social, health, and economic challenges as well.”
—Anthony P. D’Costa, Eminent Scholar in Global Studies and Professor of Economics, University of Alabama, Huntsville
For book excerpts, download a PDF here.  Follow the author’s twitter feed here.

unicorns and gazelles are black swans

Both the public and scholars pay a disproportionate amount of attention to the Silicon Valley model of entrepreneurship. But for every startup that becomes a unicorn, a thousand more mundane businesses are started. Howard Aldrich and Martin Ruef contextualize this ordinary entrepreneurship in a special issue of Academy of Management Perspectives on the reemergence of “Main Street entrepreneurship”:

Dazed and confused by the wild hype surrounding gazelles and unicorns, entrepreneurship researchers have focused on the black swans of the entrepreneurial world, even though IPOs and venture capital financing of firms are extremely rare events. Despite their rarity, entrepreneurship conferences and journals have been filled with papers on various aspects of the process of “going public” and “VC networks.” Fortunately, in the middle of the Silicon Valley mania, other scholars have been paying attention to the mundane aspects of business startups – – the ordinary business starts, numbering in the hundreds of thousands each year in the United States for businesses with employees. This special issue gives us an opportunity to look back over what we believe to be scholars’ misplaced attention to the extreme and their neglect of the mundane. Correcting the misperception that has been introduced into the literature by selection biases favoring growing and profitable firms will give scholars and policymakers a more accurate and policy-relevant picture of entrepreneurship in the 21st century.

Check it out!


Written by epopp

November 14, 2017 at 1:00 pm

the democrats can’t decide how radical they want to be on antitrust

The other day I wrote about the current moment in the spotlight for antitrust. (Here’s the latest along these lines from Noah Smith.) Today I’ll say something about the new Democratic proposals on antitrust and how to think about them in terms of the larger policy space.

The Democrats are basically proposing three things. First, they want to limit large mergers. Second, they want active post-merger review. Third, they want a new agency to recommend investigations into anticompetitive behavior. None of these—as long as you don’t go too far with the first—is totally out of keeping with the current antitrust regime. And by that I mean however politically unlikely these proposals may be, they don’t challenge the expert and legal consensus about the purpose of antitrust.

But the language they use certainly does. The proposal’s subhead is “Cracking Down on Corporate Monopolies and the Abuse of Economic and Political Power”. The first paragraph says that concentration “hurts wages, undermines job growth, and threatens to squeeze out small businesses, suppliers, and new, innovative competitors.” The next one states that “concentrated market power leads to concentrated political power.” This is political language, and it goes strongly against the grain of actual antitrust policy.

Economic antitrust versus political antitrust

Antitrust has always had multiple, competing purposes. The original Progressive-Era antitrust movement was partly about the power of trusts like Standard Oil to keep prices high. But it was also about more diffuse forms of power—the power of demanding favorable treatment by banks, or the power to influence Congress. That’s why the cartoons of the day show the trusts as octopuses, or as about to throw Uncle Sam overboard.

The Sherman Act (1890) and the Clayton Act (1914), the two major pieces of antitrust legislation, are pretty vague on what antitrust is trying to accomplish. The former outlaws combinations and conspiracies in restraint of trade, and monopolizing or attempt to monopolize. The latter outlaws various behaviors if their effect is “substantially to lessen competition, or to tend to create a monopoly.” The courts have always played the major role in deciding what that means.

Throughout the last century, the courts have mostly tried to address the ability of firms to raise prices above competitive levels—the economic side of antitrust. For the last forty years, they have focused specifically on maximizing consumer welfare, often (though not always) defined as allocative efficiency. Since the late 1970s, this has been pretty locked in, both through court decisions, and through strong professional consensus that makes antitrust officials very unlikely to challenge it.

Before the 1970s, though, two things were different. For one thing, the focus was more on protecting competition, and less on consumer welfare per se (the latter was assumed to follow from the former, and was thought of a little more broadly). For another, the courts sometimes took concerns into account other than keeping prices low.

The most common such concern was the fate of small business. Concern for small business motivated the Robinson-Patman Act of 1936, which prohibited anticompetitive price discrimination. It was clear in the Celler-Kefauver Act of 1950, which restricted mergers out of fear that chain stores would eliminate local competition. And the courts acknowledged it in cases like Brown Shoe (1962), which prevented a merger that would have controlled 7% of the shoe market by pointing to Congress’s concern with preserving an “economic way of life” and protecting “local control of industry” and “small business.”

Today, Brown Shoe is seen as part of the bad old days of antitrust, when it was used to protect inefficient small businesses and to pursue confused social goals. This is a strong consensus position among antitrust experts across the political spectrum. While no one thinks that low prices for consumers are the only thing worth pursuing in life, they are the appropriate goal for antitrust because they make it coherent and administrable. Since those experts’ views dominate the antitrust agencies, and have been codified into law through court decisions, they are very resistant to change.

The Democrats’ proposal: radical language, incremental proposals

So when the Democrats start talking about “the abuse of economic and political power,” the effects of concentration on small business, and limiting mergers that “reduce wages, cut jobs, [or] lower product quality,” they are doing two things. First, they are hearkening back to the original antitrust movement, with its complex mix of concerns and its fear of unadulterated corporate power.

Second, they are very much talking about political antitrust, and political antitrust is deeply challenging to the status quo. But their actual proposals are considerably tamer than the fiery language at the beginning, and are structured in a way that doesn’t push very hard on the current consensus. New merger guidelines could make some difference around the margins. Post-merger review would definitely be good, since there’s currently no enforcement of pre-merger conditions that firms agree to, and no good way to figure out which merger approvals had negative effects. I have a hard time seeing a new review agency having much effect, though, since it’s just supposed to make recommendations to other agencies. Even I don’t like bureaucracy that much.

So my read on this is that the Democrats feel like they need a new issue, and it needs to look like it helps the little guy, and they want to sound like populist firebrands. But when you get down to the nitty gritty, they aren’t really so interested in challenging the status quo. That is, basically, they’re Democrats. Still, that the language is in there at all is remarkable, and reflects a changing set of political possibilities.

Next time I’ll look at some of the problems people are suggesting antitrust can solve. Because there are a lot of them, and they’re a diverse group. Tying them together under the umbrella of “antitrust” gives an eclectic political project some nominal coherence. But is it politically practicable? And could it actually work?

Final note: If you are interested in the grand historical sweep of antitrust in capitalism, I recommend Brett Christophers’ The Great Leveler. Among other things, he totally called the emerging wave of interest before it actually happened. Sometimes the very long lens is the right one to use.

Written by epopp

August 3, 2017 at 3:04 pm

why antitrust now?

Antitrust is having a moment. A couple of years ago, with the possible exception of complaining about never-ending airline mergers, no one paid attention to antitrust debates. Today, it’s all over the place. A few months ago, it was the Economist proclaiming “America Needs a Giant Dose of Competition.” Last month it was Amazon and Whole Foods. And now antitrust has become a key plank of the new Democratic platform.

I’ve been thinking about this for a while, but this antitrust explainer written by Matt Yglesias yesterday (which is generally quite good) motivated me to put fingers to keyboard. So I’m going to break this reflection up into three parts: Why antitrust now? What does the new antitrust debate mean? And what would it take for it to succeed? Today, I’ll tackle the first.

At one level, the rise of antitrust interest is just a perfect convening of streams, in the Kingdon sense. A problem (or loose collection of problems) rises to public attention, people are already out there advocating a solution, even if so far unsuccessfully, and—the moment we’re in now—politicians have the motivation to grab that solution and turn it into policy, or at least a platform. It’s just about timing, and it’s not predictable.

At the same time, I think we can unpack a couple of different factors that help us think about “why now”. Some of this is covered in the Yglesias piece. But there are a few things I’d add, and some different angles I’d highlight. So without further ado, here are four reasons antitrust is suddenly getting attention.

1. It’s a reaction to a change in objective conditions.

There is a degree of consensus that market concentration is increasing across the economy. Even if you don’t think concentration is a problem, it wouldn’t be surprising that an increase would lead some people to challenge it, and make media more open to hearing that claim. This is probably a contributing factor. But market concentration has been increasing for a long time, and the link between concentration and exercise of power, whether market power or political power, is at best complicated. I don’t think the rise in concentration explains much of the antitrust attention.

Other phenomena are emerging that are objectively new, and raise new questions about how to govern them. Amazon now controls 43% of internet retail sales in the U.S. That’s astonishing, and at least a little alarming. But we’ve now seen several generations of various platforms (operating systems, browsers, social networks) rise to dominance and sometimes fall, mostly without a lot of antitrust attention—Microsoft, at the turn of the millennium, being the significant exception. These objective changes are a necessary but definitely not sufficient for public attention to rise.

2. New actors are organizing around this issue.

A lot of the noise around antitrust is coming from a relative handful of people. Until the Democrats came on board, it was Elizabeth Warren on the political side, and before that Zephyr Teachout, the Fordham law professor who gave Andrew Cuomo a run for his money in 2014.

On the think tank side, as Yglesias notes, it’s the Open Markets Program at New America. Fellow Lina Khan, once of the Teachout campaign, landed an NYT op-ed on Amazon and Whole Foods. Fellow Matt Stoller’s Atlantic article on antitrust, “How Democrats Killed Their Populist Soul,” got a lot of attention when it came out last fall. Barry Lynn, who runs the program, has been working on this issue for a decade.

The Roosevelt Institute is the other significant player in this space. (Here’s a good, if now difficult to read, piece from last summer explaining the history of Roosevelt.) Marshall Steinbaum and others have made the case for a range of antitrust issues on a variety of grounds, and the influence of both these organizations on the new Democratic congressional platform is clearly visible.

There’s no question that this kind of policy advocacy—talking to policymakers, writing articles and op-eds—is making a difference. But its impact has been facilitated by two other things.

3. The space of expertise is changing in unexpected ways.

Antitrust policy is a space heavily dominated by experts. Congress rarely touches antitrust issues. The public rarely pays attention. Presidents generally talk a good antitrust game, and may care more or less about appointing antitrust officials who will pursue a particular policy line. But for the most part, antitrust is dominated by the lawyers and economists who serve in the Antitrust Division and FTC, consult on antitrust cases, write academic articles, and a handful of whom become judges.

And there is bipartisan consensus among these experts that concentration isn’t generally a problem. Markets are contestable. Predatory pricing is irrational, because firms know that if they drive out competitors then jack up prices, they’ll just attract some new entrant into the market. There’s really no point. Yes, there may be a little more antitrust enforcement among Democrats than Republicans. But it’s a game played “between the 45 yard lines.” As Richard Posner said recently, “Antitrust is dead, isn’t it?”

But this space is changing in interesting ways. The change doesn’t seem to be coming from the antitrust community itself, exactly. But it’s coming from people with the academic clout to be taken seriously.

From one direction, you have people like Jason Furman and Joseph Stiglitz making arguments about labor market monopsony contributing to lower wages and arguing that economic changes require new kinds of antitrust solutions. From another, you have Luigi Zingales overseeing an effort (at the University of Chicago’s Stigler Center, no less) to advocate for stronger antitrust, calling his position “pro-market” rather than “pro-business”. Zingales’ efforts are also notable for bringing in historians, political scientists and other experts usually not privy to the antitrust policy conversation.

None of these people work primarily on antitrust issues or even industrial organization, but they have the status to be taken seriously even if they are not among the usual suspects of antitrust. Their novel arguments have the capacity to shift the expert consensus about antitrust—either mildly, as in Furman’s arguments about the importance of labor monopsony (which don’t require a radical rethinking of the current approach), or more radically, as in Zingales’s advocacy of an antitrust that takes political power seriously.

I’ll discuss these changes more in the next couple of posts, but in terms of explaining “why antitrust now,” the point is that these insider/outsider dissenters are amplifying new voices and new issues, and thus contributing to the current wave of attention.

4. The cultural moment is right for other reasons.

If there’s one belief that seems to unite Americans across the political spectrum these days, it’s that the game is rigged against the ordinary person. For the many Americans who think big business is doing at least some of the rigging, this produces a new openness to arguments about concentration and corporate control. As much as anything else, I think this explains the current interest in antitrust. People are receptive to arguments that purport to explain why they’re being screwed.

Antitrust is a protean issue. It can channel many different types of fears and at least theoretically respond to many different kinds of problems. Whether it can do so effectively, and whether antitrust is the right tool for the job, is a different question. In my next post I’ll try to unpack some of those different problems, why they’re now being linked together under the umbrella of “antitrust,” and draw on some antitrust history to think about what current efforts mean.

Written by epopp

August 1, 2017 at 1:51 pm

will trade associations exacerbate growing economic inequality in the united states? a guest post by howard aldrich

Howard Aldrich is the Kenan Professor of Sociology at UNC-Chapel Hill. This post examines an important question at the intersection of economic and political sociology, the role that trade groups have in American politics. This post originally appeared on Howard Aldrich’s blog and is reposted with permission.

An essay prepared for a special section of the Journal of Management Inquiry gave me an opportunity to reflect on potential social changes in the US resulting from major political changes over the past three decades.   I believe a long-term decline in class consensus within the American business elite (Mizruchi, 2013) has raised the relative power of trade associations, compared to the powerful peak business associations of a bygone era, paving the way for more narrow self-interested actions and diminishing the influence of other kinds of interest associations. The worldview of the incoming president and his cabinet officials will facilitate this development, I believe.

Escher "Drawing Hands"

Historically, business managers and owners could attempt to exert influence at four different levels in the system. First, they could get involved as individual executives, contributing money, lobbying officials and agencies, and so forth. Second, representatives of their organizations could do the same, especially through board interlocks with other firms in different industries, through which could diffuse general business practices as well as practices aimed at producing public goods  (Davis & Greve, 1997; Galaskiewicz, 1985). Third, firms could participate in specific industries’ trade associations that favored policies and practices they favored (Ozer & Lee, 2009). Fourth, and perhaps most important, a handful of peak associations sat above the previous three levels, cutting across firms and industries, and claiming to speak for the business community as a whole. For example, the now-defunct CED (Committee for Economic Development) advertised itself as offering “reasoned solutions from business in the nation’s interests.”

Read the rest of this entry »

Written by fabiorojas

January 13, 2017 at 12:23 am