Companies are institutions in a global network
from Maria Alejandra Madi and the WEA Pedagogy Blog
The expansion of the organization of production across different nation-states has been a reality since the middle 1950s. The existence of nation-states with different regulatory regimes in labour markets, social security, financial and fiscal regulations have created opportunities for specific strategies offered by transnationality.
“Who are the key economic actors holding the largest fraction of control? To what degree are the top economic actors interconnected with each other?”. To answer these questions, James Glattfelder develops an analysis of the global ownership network of TNCs in his 2012 book Decoding Complexity: Uncovering Patterns in Economic Networks (Springer Theses). As a result of the complex analysis, the author uncovers the true organization of key global actors and novel features of complex systems of current real-world ownership networks. His effort lies at the interface between the realms of economics and the emerging field loosely referred to as complexity science.
Among his research conclusions, Glattfelder lists the top 50 corporate power-holders considering that the importance of the economic actors is related to their level of integrated control. As a matter of fact, the top economic actors are highly interconnected and organize a global network of corporations. Another interesting observation is that most of the top power-holders are financial intermediaries.
From an economics point of view, these findings may suggest new questions because of their implications on market competition and financial instability. read more