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The Political Economy of Private Law: Comment on ‘The code of capital – how the law creates wealth and inequality’

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  • Thiemann Matthias

    (Sciences Po Centre des Etudes Européennes et Politiques Comparées, Paris, France)

Abstract

Katharina Pistor’s book The code of capital – how the law creates wealth and inequality (Pistor, K. (2019). The code of capital – How the law creates wealth and inequality. Princeton: Princeton University Press) is an original and insightful intervention in the quest to understand both the rising inequality of the last 40 years, as well as the inner dynamics of capitalism, a social formation that has ruled in western societies for about 200 years now. Pistor shares many of the convictions of the publications in the journal Accounting, Economics and Law, such as the dangers to democracy inherent in the corporate form (Robé, J. P. (2011). The legal structure of the firm. Accounting, Economics and Law, 1(1). https://doi.org/10.2202/2152-2820.1001; Strasser, K., & Blumberg, P. (2011). Legal form and economic substance of enterprise groups: Implications for legal policy. Accounting, Economics and Law, 1(1). https://doi.org/10.2202/2152-2820.1000), the fact that firms and corporate form need to be distinguished (Y. Biondi, A. Canziani, & T. Kirat (Eds), (2007). The firm as an entity: Implications for economics, accounting and law. New York and London: Routledge) and that shareholders do not own corporations, but just their shares, it is only appropriate to discuss and present it to the wider audience of the journal, pointing to its fundamental insights and potential for follow-up research. The title of the book and its set-up evoke both Luhmann’s system theory with its penchant for binary code as well as Marx’s capital (Marx, K. (1955[1867]). Das Kapital. Berlin: Dietz Verlag, Vol. 1). Combining the coding of social systems and their relentless dynamic in innovating and generating new forms by recursively referring to established elements (Luhmann, N. (1984). Soziale Systeme. Frankfurt am Main: Suhrkamp Verlag; Luhmann, N. (1995). Das Recht der Gesellschaft. Frankfurt am Main: Suhrkamp Verlag) with Marx’s focus on the structuring effects capital has on society is making this a very inspiring book, which at the same time evokes many follow-up questions.

Suggested Citation

  • Thiemann Matthias, 2021. "The Political Economy of Private Law: Comment on ‘The code of capital – how the law creates wealth and inequality’," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 11(1), pages 37-51, March.
    • Handle: RePEc:bpj:aelcon:v:11:y:2021:i:1:p:37-51:n:4
    DOI: 10.1515/ael-2020-0077
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    References listed on IDEAS

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    1. Strasser Kurt A. & Blumberg Phillip, 2011. "Legal Form and Economic Substance of Enterprise Groups: Implications for Legal Policy," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 1(1), pages 1-30, January.
    2. Yuri Biondi & Arnaldo Canziani & Thierry Kirat, 2007. "The Firm as an Entity: Implications for Economics, Accounting, and the Law," Post-Print halshs-00203355, HAL.
    3. Daniela Gabor & Cornel Ban, 2016. "Banking on Bonds: The New Links Between States and Markets," Journal of Common Market Studies, Wiley Blackwell, vol. 54(3), pages 617-635, May.
    4. Robé Jean-Philippe, 2011. "The Legal Structure of the Firm," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 1(1), pages 1-88, January.
    5. Daniela Gabor, 2016. "The (impossible) repo trinity: the political economy of repo markets," Review of International Political Economy, Taylor & Francis Journals, vol. 23(6), pages 967-1000, November.
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    More about this item

    Keywords

    trust; regulation; capital;
    All these keywords.

    JEL classification:

    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • K12 - Law and Economics - - Basic Areas of Law - - - Contract Law
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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