SETTLER + RENTIER CAPITALISMS EB434 ENTERPRISE + GOVERNANCE

Transcription

1 SETTLER + RENTIER CAPITALISMS 14 EB434 ENTERPRISE + GOVERNANCE

2 settler capitalisms (revisited) 18th-20th centuries mark the increasingly intensive settlement of the New World the societies & economies that developed were heavily patterned institutionally and culturally by the legacies of the original colonial power former British colonies, founded on dispossession of native inhabitants, nonetheless developed into some of the most economically and culturally vibrant, open cosmopolitan and prosperous societies eg. USA, Canada, New Zealand, Australia (some elements of South Africa) British institution legacy during the Palestine Mandate period on post-independence Israel Former Spanish & Portuguese settler societies have faced more political instability, class conflict & mixed economic fortunes

3 Smaller Anglo-American economies New Zealand, Australia (and, to a lesser extent, Canada) Less competition in good markets More rents to be extracted Compounded by trade protectionism and resource rents (especially Australia and Canada in the latter case) Hence agency slack between owners and managers leads managers to capture rents, to entrench themselves, and to share rents with powerful organized labour But economic liberalization (eg tariff abolition) reduced such rents, agency slack and shifted these economies to more British and US style contemporary corporate governance

4 International telegraph network in

5 Small vulnerable economies? Canada, Australia & New Zealand have had more rigorous foreign takeover regulatory regimes than UK & USA because: Contending identities between ex-british colonies (with UK firms as major investors) and economic nationalism (1960s especially) Concerns about being client states of the USA (1960s-1970s especially) Significant natural resource-based extractive industries, which are more politically sensitive Less competitive goods markets (reflecting smaller markets, trade protectionism & rent-seeking by firm stakeholders) But radical liberalization from mid-1980s made these economies very open today & with tough competition policy

6 Israel late C19th Zionist movement to re-establish a Jewish homeland in the land of Israel (Palestine, then under Turkish imperial rule) periodic violent tensions with resident Arab communities communitarian orientation & strong strand of socialist idealism combined with an ethnic nationalism communitarian institutions such as the kibbutz & moshav, with communal property, played key roles in early development prior to establishment of the State of Israel in 1948 later entrepreneurial culture, Start Up Nation phenomena from the 1990s in ICT etc ultra-orthodox Jewish communities - such as the Hasidim & (partial) selfreliance

7 rentier capitalisms

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11 Russian case great personal fortunes created in transition from Soviet system (see later lecture) heavy reliance on gas & oil exports; making the economy vulnerable during price falls key European clients are also beholden to Russian supply

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13 resource curse? from the 1960s clear that some natural resource poor economies, esp. in Eat Asia, out-performed resource rich countries resource curse refers to the risk that over-reliance on or several major resource (eg gas, oil, or a major mineral) may draw productive resources away from other sectors of the economy, cause the exchange rate to rise (from the export boom), & make the economy vulnerable in downtimes also concerns about the politically corrupting nature of a resources boom (governments over-spend, rent-seeking & corruption to get rights to resources), & undermine a culture of entrepreneurship & innovation. some governments, most notably Norway s, have created a national fund to manage responsibility natural resource wealth

14 dependency resource dependency is made worse by government dependency on resource revenues + made more or less worse by demographic trends economies can be lazily reliant on natural demographic expansion (or immigration-led) for growth the dependency ratio of children and the elderly also impacts on patterns of expenditure in an economy

15 demographic dependency ratio

16 aged dependency ratios

17 nakedcapitalism.com