Stakeholder Capitalism: Progressive Dream or Nightmare?

  • Steven Rosefielde University of North Carolina, Chapel Hill, USA
Keywords: Joseph Stiglitz, liberal capitalism, progressive capitalism, socially responsible corporations, progressive stakeholders, stakeholder and shareholder joint sovereignty


Joseph Stiglitz’s proposes transforming America’s “liberal capitalism” into “progressive capitalism” by encouraging socially responsible corporations to include progressive stakeholders in corporate decision-making. He suggests that the time may be ripe because the Business Roundtable recently endorsed efforts to make American corporations more socially responsible. He predicts that if the Business Roundtable is sincere, progressive socially responsible, stakeholder and shareholder joint sovereign corporations will create a more dynamic economy, with greater shared prosperity and uplift the majority again to a middle-class life. However, Stiglitz fails to probe the contradictions and moral hazards inherent in stakeholder-shareholder co-sovereignty that could transform his dream into a nightmare. This essay elaborates and critically evaluates Stiglitz’s concept in the contemporary American political context. It shows that while progressive capitalism founded on stakeholder-shareholder co-sovereignty could have merit, corporations should reject it until Stiglitz explains how corporate boards of directors can safely test the waters.

Author Biography

Steven Rosefielde, University of North Carolina, Chapel Hill, USA

Professor of Economics at the University of North Carolina, Chapel Hill. He received his Ph.D. in Economics from the Harvard University and is a member of the Russian Academy of Natural Sciences (RAEN). He has taught in Russia, China, Japan and Thailand. His most recent publications include the following: S. Rosefielde, Democracy and Its Elected Enemies: The West’s Paralysis, Crisis and Decline (Cambridge University Press, 2013); S. Rosefielde and R. W. Pfouts, Inclusive Economic Theory (World Scientific Publishers, 2014); S. Rosefielde and Q. Mills, Global Economic Turmoil and the Public Good (World Scientific Publishers, 2015); S. Rosefielde and B. Dallago, Transformation and Crisis in Central and Eastern Europe: Challenges and Prospects (Routledge, 2016); S. Rosefielde, Kremlin Strikes Back: Russia and the West after Crimea’s Annexation (Cambridge University Press, 2017); S. Rosefielde and Q. Mills, The Trump Phenomenon and Future of US Foreign Policy (World Scientific Publishers, 2016); S. Rosefielde, Trump’s Populist America (World Scientific Publishers, 2017); S. Rosefielde and J. Leightner, China’s Market Communism: Challenges, Dilemmas, Solutions (Routledge, 2017).


Adam I. Political Ideology Today. Manchester: Manchester University Press; 2001.

Aoki M, Jackson G, Miyaiima H. Corporate Governance in Japan. London: Oxford University Press; 2008.

Appiah KA. The myth of meritocracy: who really gets what they deserve? Sorting people by ‘merit’ will do nothing to fix inequality. Guardian; 2018 . Available from:

Bergson A. A Reformulation of Certain Aspects of Welfare Economics. Quarterly Journal of Economics. 1938; 52(1): 310-334.

Bergson A. Social Choice Under Representative Government. Journal of Public Economics. 1976; 6(3):171-190.

Bergson A. The Concept of Social Welfare. Quarterly Journal of Economics. 1954; 68(2): 233-253.

Business Roundtable. Business Roundtable Redefines the Purpose of a Corporation to Promote ‘An Economy That Serves All Americans’; 2019 Available from:

Chang HJ, Stiglitz JE, The World Bank. The Rebel Within. London: Anthem; 2001.

Clark JM. Toward a Concept of Workable Competition. American Economic Review. 1940 June; 30(2):241-256.

Estrin S, Uvalić M. From Illyria towards Capitalism: Did Labor-Management Theory Teach Us Anything about Yugoslavia and Transition in Its Successor States? 50th Anniversary Essay. Comparative Economic Studies. 2008; 50: 663-696.

Fourier C. Design for Utopia: Selected Writings. New York: Schocken; 1971.

Galbraith JK. New Industrial State. New York: Houghton Mifflin; 1967.

Güler A, Crowther D (editors). Handbook of Corporate Governance and Social Responsibility. London: Routledge; 2016.

Lange O. On the Economic Theory of Socialism, Part One. Review of Economic Studies. 1936; 4(1): 53-71.

Lenin V. Left Wing Communism. Moscow: Executive Committee of the Communist International for delegates to its 2nd World Congress; 1920.

Lerner AP. Theory and Practice in Socialist Economics. Review of Economic Studies. 1938;6(1): 71-75.

Littler J. Against Meritocracy: Culture, power and myths of mobility. London: Routledge; 2017.

Markovits D. The Meritocracy Trap: How America’s Foundational Myth Feeds Inequality, Dismantles the Middle Class, and Devours the Elite. London: Penguin; 2019.

Marx K. Economic and Philosophical Manuscripts of 1844. Moscow: Progress Publishers; 1959.

McGaughey E. The Codetermination Bargains: The History of German Corporate and Labour Law. Columbia Journal of European Law. 2016; 23(1):1-43.

Meade J. The Controlled Economy. London: Routledge; 2013.

Palladino L. The Economic Argument for Stakeholder Corporations. Roosevelt Institute Working Paper; 2019. Available from:

Pareto V. Manual of Political Economy. London: Oxford University Press; 2014.

Rosefielde S. Economic Theory of the Second Worst. Higher School of Economics Journal Moscow. 2015; 19(1): 30-44.

Rosefielde S. Mills Q. Populists and Progressives. Singapore: World Scientific Publishers; 2020.

Sawicky M. Progressive Capitalism Is Impossible. Jacobin; 2020. Available from:

Smith A. The Theory of Moral Sentiments and Essays on Philosophical Subjects; 1759.

Stiglitz JE. A Progressive Agenda for the Twenty-First Century. In: Woolner SB, Thompson JM. Progressivism in America: Past, Present and Future. New York: Oxford University Press; 2015: 215-320.

Stiglitz JE, Abernathy N, Hersh A, Holmberg S, Konczal M. Rewriting the Rules of the American Economy: An Agenda for Growth and Shared Prosperity. New York: W.W.Norton; 2015.

Stiglitz JE. An Agenda for Sustainable and Inclusive Growth for Emerging Markets. Journal of Policy Modeling. 2016; 38: 693-710.

Stiglitz JE. Globalization and its Discontents. New York: W.W.Norton; 2002.

Stiglitz JE. Is Stakeholder Capitalism Really Back? Columbia Business School; 2019 Available from:

Stiglitz JE. Markets, States and Institutions. Roosevelt Institute Working Paper; 2017. Available from:

Stiglitz JE. People, Power, and Profits: Progressive Capitalism for an Age of Discontent. New York: W.W.Norton; 2019.

Stiglitz JE. Transparency in Government. In: The World Bank. The Right to Tell. The Role of Mass Media in Economic Development. Washington DC: World Bank Institute; 2002. p. 27-44

Taylor K (editor, translator). Henri de Saint Simon, 1760-1825: Selected writings on science, industry and social organization. New York: Holmes and Meier Publishers Inc.; 1975: 158-161.

Tawney R. The Acquisitive Society. Republished. New York: Harcourt Brace and Howe; 2004.

Weitzman M. The Share Economy: Conquering Stagflation. Cambridge MA: Harvard University Press; 1986.

Wray R. Modern Money Theory: A Primer on Macroeconomics for Sovereign Monetary Systems. Houndmills, Basingstoke: Palgrave Macmillan; 2015: 137-141, 199-206.

How to Cite
Rosefielde, S. (2020). Stakeholder Capitalism: Progressive Dream or Nightmare?. LUMEN Proceedings, 11, 14-23.