The Impact of Financialization on Management and Employment Outcomes
Upjohn Institute Working Paper No. 13-191
45 Pages Posted: 20 Mar 2013 Last revised: 16 Jun 2015
Date Written: February 28, 2013
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.
Keywords: United States, financialization, market deregulation, institutional change, private equity, institutional investors, management and labor relations
JEL Classification: D2, G3, J5, N2, P1
Suggested Citation: Suggested Citation