This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

  1. Home
  2. ASSA Annual Meeting
  3. 2023
  4. Program
  5. Global Capitalism
« Back to Results

Global Capitalism

Paper Session

Sunday, Jan. 8, 2023 8:00 AM - 10:00 AM (CST)

J.W. Marriott New Orleans, Rosalie/St. Claude
Hosted By: Union for Radical Political Economics
  • Chair: Sergio Cámara-Izquierdo, Metropolitan Autonomous University-Azcapotzalco

Corporate Governance Under Financial Control: Shareholder Primacy and (Im)patient Capital of Asset Managers

Albina Gibadullina
,
University of British Columbia

Abstract

The recent decade has been characterized by the rapid proliferation of US asset management
firms who currently manage tens of trillions of dollars in investments globally. This study
examines one particular consequence of asset manager capitalism—the prioritization of the
interests of shareholders above all other stakeholder groups. While many of these
passively-managed investment funds proclaim to be long-term investors and providers of
“patient capital,” their rise in the United States has coincided with increased dividend payouts
and stock buybacks. Given a lack of firm-level studies exploring the relationship between
ownership by asset management firms and shareholder payouts, this paper examines whether
higher rates of ownership by US-based asset managers leads firms to prioritize the short-term
interests of shareholders. We analyze the shareholder composition of 39,029 globally listed firms
in 2018 (provided by the Orbis database) and the investment holdings of US institutional
investors (including mutual funds) in US publicly-traded firms between 1997 and 2020 (provided
by the Thomson Reuters/Refinitiv database). Under various model configurations, we find a
positive and statistically significant relationship between ownership by US-based asset managers
and distributed payouts in the form of dividends and stock buybacks. While there are
country-level and industry-level differences among the firms investigated, the effect of US asset
management ownership remains strong across the majority of examined cases. The study makes
a timely contribution to the literatures on shareholder primacy and asset manager capitalism by
systematically outlining the impacts of US asset managers on shareholder payouts across
countries and economic sectors.

The Economics of Absolute Surplus Value: Dynamic Effects of Overwork

Gilbert Skillman
,
Wesleyan University

Abstract

Formal classical and Marxian models of capitalist commodity production have commonly been premised on linear input-output systems in which requisite direct labor inputs are specified without distinguishing between number of workers employed and hours expended per worker and labor costs are understood to be bilinear in total labor hours and a given wage rate. Taken together, these assumptions imply that capitalist employers are indifferent among alternative combinations of workers hired and hours expended per worker yielding identical total labor hours. This implication is inconsistent with the long history of struggle to limit the working day. It is also starkly at odds with Marx’s formulation of absolute surplus value in the first volume of Capital, according to which capitalists seek to extend the working day up to limits established by law or workers’ biological need for rest. An earlier paper, presented at the 2021 URPE/ASSAs sessions, showed the implications for capitalist production and wage and profit rate determination when capitalist firms are not indifferent across possible combinations of workers and hours per worker due to the combination of imperfect substitutability of labor hours per worker and number of workers on one hand and quasi-fixed labor costs on the other. The present paper continues that analysis by extending the analysis to a multi-sector model and considering the dynamic implications of excessive working days in cases where capitalist competition drives the wage below its socially determined subsistence level.

Output and Employment in the US During the COVID-19 Crisis

Joshua Greenstein
,
Hobart and William Smith Colleges

Abstract

I analyze the interaction between real output, income, and job losses and gains during the COVID-19 economic crisis and recovery. When calculating total output, it is common to use incomes to impute the value of output for some industries. Foley and Basu (2013) found that indices of output that exclude these industries better correlated to employment changes than traditional measures of GDP. I extend this analysis to the current COVID-19 crisis to compare the rise and fall of output in these types of industries, and to correlate those patterns to changes in overall employment, types of employment, and income during the crisis. I also relate these patterns to my own previous work on the precarization of work and the growing class of precarious workers in the US.

The General Law of Capitalist Accumulation and a Labor-Shortage Theory of Cycles

Sergio Cámara-Izquierdo
,
Metropolitan Autonomous University-Azcapotzalco

Abstract

The general law of capitalist accumulation is an indispensable theoretical foundation for the analysis of the capitalist macrodynamics in Marxist economic theory. A fundamental postulate of this law is that the availability of labor power does not imply a limit to capital accumulation, given the existence and reproduction of an industrial reserve army available to join the ranks of the exploited labor force. Nonetheless, the chapter of volume I of Marx’s Capital dedicated to the law, specially its first section, has been widely used by several strands of the Marxist literature to conceptualize and model the short-term macrodynamics, linking the recurrence of business cycles with the relative exhaustion of the available labor force. In this paper, we argue that the apparent contradiction between this line of research and the fundamental postulate of the law is not such when the different time horizons in which the capital accumulation unfolds are incorporated into the analysis. From this hypothesis, a rereading of the first four sections of the chapter on the general law of capital accumulation is offered. Concretely, Marx’s analysis of the forms of the surplus population was helpful to derive a short-term fraction and a long-term fraction of the industrial reserve army. When this differentiation is applied to the development of a theory of labor-shortage business cycles, the apparent contradiction between this theory and the fundamental postulate of the general law of capitalist accumulation vanishes.
JEL Classifications
  • B5 - Current Heterodox Approaches
  • F6 - Economic Impacts of Globalization