Stakeholder Capitalism: Progressive  Dream or Nightmare?

Steven Rosefielde

doi:10.18662/lumproc/gekos2020/03

Steven Rosefielde University of North Carolina, Chapel Hill, USA

DOI: https://doi.org/10.18662/lumproc/gekos2020/03

Keywords: Joseph Stiglitz, liberal capitalism, progressive capitalism, socially responsible corporations, progressive stakeholders, stakeholder and shareholder joint sovereignty

Abstract

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).

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