Abstract

http://ssrn.com/abstract=2070942
 
 

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Leviathan in Business: Varieties of State Capitalism and Their Implications for Economic Performance


Aldo Musacchio


Brandeis University- International Business School; Harvard Business School - Business, Government and the International Economy Unit; National Bureau of Economic Research

Sérgio G. Lazzarini


Insper Institute of Education and Research

May 30, 2012


Abstract:     
In this paper we document the extent and reach of state capitalism around the world and explore its economic implications. We focus on governmental provision of capital to corporations – either equity or debt – as a defining feature of state capitalism. We present a stylized distinction between two broad, general varieties of state capitalism: one through majority control of companies (e.g. state-controlled SOEs) and a hybrid form that relies on minority investments in companies by development banks, pension funds, sovereign wealth funds, and the government itself. We label these two alternative modes Leviathan as a majority investor and Leviathan as a minority investor, respectively. Next we differentiate between these two modes by describing their key fundamental traits and the conditions that should make each mode more conducive to development and superior economic performance.

Number of Pages in PDF File: 63

Keywords: state capitalism, state-owned enterprises, development banks, sovereign wealth funds

JEL Classification: P51, L32, L33

working papers series





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Date posted: May 31, 2012 ; Last revised: June 30, 2012

Suggested Citation

Musacchio, Aldo and Lazzarini, Sérgio G., Leviathan in Business: Varieties of State Capitalism and Their Implications for Economic Performance (May 30, 2012). Available at SSRN: http://ssrn.com/abstract=2070942 or http://dx.doi.org/10.2139/ssrn.2070942

Contact Information

Aldo Musacchio
Brandeis University- International Business School ( email )
Mailstop 32
Waltham, MA 02454-9110
United States
Harvard Business School - Business, Government and the International Economy Unit ( email )
Soldiers Field Road
Boston, MA 02163
United States
HOME PAGE: http://www.people.hbs.edu/amusacchio/
National Bureau of Economic Research ( email )
1050 Massachusetts Avenue
Cambridge, MA 02138
United States
HOME PAGE: http://www.nber.org/people/aldo_musacchio
Sérgio Giovanetti Lazzarini (Contact Author)
Insper Institute of Education and Research ( email )
R Quata 300
Sao Paulo, 04542-030
Brazil
55-11-45042387 (Phone)
HOME PAGE: http://www.sergiolazzarini.insper.edu.br/indexelazza.html
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