Financialization and the corporation in the twenty-first century

Chapter One outlines the major evolution of the corporate form, from European roots to American expansion. The corporation has appeared through the co-evolution of economics, law, and finance. It is a social construction with no naturally occurring precedent or impetus. As technology evolved and the opportunities for mass production appeared, the corporation became the primary legal and financial system that allowed for the coordination of production and distribution of incomes. Legal decisions altered the definition of incomes and the ability to enforce contractual claims, expanding the role of financial interests and values in coordinating productive activity. The use of markets to trade rights to income and create credit is an accelerating feature of the corporation. Developments in economic theory provided a theoretical justification for these new practices. The latest stage of financialization in the twenty-first century represent a continuation of the habits first articulated in the late nineteenth century.