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A bridge over troubled water: A Structural Political Economy of vertical integration

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  • Cardinale, Ivano

Abstract

This article proposes a new interpretation of the logical process of vertical integration, exploring its socio-political dimension. The first step is to show that models of industrial interdependencies (in the Leontief and Sraffa formulations) and vertically integrated models (in the Pasinetti formulation) imply profoundly different views on production, distribution, and socio-political conflicts. The next step is to focus on the process of vertical integration in itself—on its being a ‘bridge’ between such different views. Because analytically equivalent representations of economic structures have such different socio-political implications, economic structures cannot be seen as univocally determining economic interests or conflicts in society. This result opens up a new field for structural analysis: studying how the formation of interests in society is influenced, but not determined, by economic structures. The article suggests a route to address the socio-political dimension of economic structures, which is largely left on the background by structural economic analysis.

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  • Cardinale, Ivano, 2018. "A bridge over troubled water: A Structural Political Economy of vertical integration," Structural Change and Economic Dynamics, Elsevier, vol. 46(C), pages 172-179.
    • Handle: RePEc:eee:streco:v:46:y:2018:i:c:p:172-179
    DOI: 10.1016/j.strueco.2018.05.007
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    Cited by:

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    4. Cardinale, Ivano & Landesmann, Michael, 2022. "Generalising the political economy of structural change: A Structural Political Economy approach," Structural Change and Economic Dynamics, Elsevier, vol. 61(C), pages 546-558.
    5. Di Tommaso, Marco R. & Tassinari, Mattia & Barbieri, Elisa & Marozzi, Marco, 2020. "Selective industrial policy and ‘sustainable’ structural change. Discussing the political economy of sectoral priorities in the US," Structural Change and Economic Dynamics, Elsevier, vol. 54(C), pages 309-323.
    6. Cardinale, Ivano, 2022. "On means and ends in structural economic analysis: Broadening the field of enquiry," Structural Change and Economic Dynamics, Elsevier, vol. 61(C), pages 450-457.
    7. Baranzini, Mauro L. & Mirante, Amalia, 2021. "Pasinetti's theorem: A narrow escape, for what was to become an inexhaustible research programme," Structural Change and Economic Dynamics, Elsevier, vol. 59(C), pages 470-481.
    8. Barbieri, Elisa & Huang, Manli & Pi, Shenglei & Pollio, Chiara & Rubini, Lauretta, 2021. "Investigating the linkages between industrial policies and M&A dynamics: Evidence from China," China Economic Review, Elsevier, vol. 69(C).
    9. Venkatachalam, Ragupathy & Kumar, Sunil Mitra, 2022. "Economic Structures and Dynamics: A Morphogenetic View," Structural Change and Economic Dynamics, Elsevier, vol. 61(C), pages 474-485.
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    More about this item

    Keywords

    Structural Political Economy; Structural economic analysis; Economic interests; Vertical integration; Input-output analysis;
    All these keywords.

    JEL classification:

    • B10 - Schools of Economic Thought and Methodology - - History of Economic Thought through 1925 - - - General
    • B20 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - General
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General
    • L16 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Industrial Organization and Macroeconomics; Macroeconomic Industrial Structure
    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State

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