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The Impact of Financialization on Management and Employment Outcomes

Author

Listed:
  • Rosemary Batt

    (Cornell University)

  • Eileen Appelbaum

    (Rutgers University)

Abstract

This paper examines three questions: 1) How and why have financial models of doing business emerged in the last three decades? 2) What new forms of financial capitalism have become important in the current period? 3) How do new financial intermediaries, such as private equity, and the financial strategies of nonfinancial corporations affect the management of companies and employment outcomes? The paper describes how deregulation and institutional change created the conditions for a new, more powerful role for finance capital in the governance of U.S. companies, and it synthesizes the empirical evidence on the process and outcomes of financialization in large publicly traded corporations, as well as those taken over by private equity. Areas for future research are identified to examine how financialization affects management and employment relations in the postcrisis period.

Suggested Citation

  • Rosemary Batt & Eileen Appelbaum, 2013. "The Impact of Financialization on Management and Employment Outcomes," Upjohn Working Papers 13-191, W.E. Upjohn Institute for Employment Research.
    • Handle: RePEc:upj:weupjo:13-191
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    References listed on IDEAS

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    Cited by:

    1. Joel Rabinovich & Niall Reddy, 2024. "Corporate Financialization: A Conceptual Clarification and Critical Review of the Literature," Working Papers PKWP2402, Post Keynesian Economics Society (PKES).
    2. Ken-Hou Lin, 2016. "The Rise of Finance and Firm Employment Dynamics," Organization Science, INFORMS, vol. 27(4), pages 972-988, August.
    3. Kun Su & Heng Liu, 2021. "Financialization of manufacturing companies and corporate innovation: Lessons from an emerging economy," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 42(4), pages 863-875, June.

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    More about this item

    Keywords

    United States; financialization; market deregulation; institutional change; private equity; institutional investors; management and labor relations;
    All these keywords.

    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • G3 - Financial Economics - - Corporate Finance and Governance
    • J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining
    • N2 - Economic History - - Financial Markets and Institutions
    • P1 - Political Economy and Comparative Economic Systems - - Capitalist Economies

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