Financial Regulation and Social Welfare: The Critical Contribution of Management Theory
Academy of Management Review Vol. 41 (2016) No. 2, pp. 298-323, Special Topic Forum on 'Management Theory and Social Welfare'
67 Pages Posted: 1 Nov 2013 Last revised: 17 Mar 2016
Date Written: May 28, 2015
While many studies explain how social science theories shape social reality, few reflect critically on how such theories should shape social reality. Drawing on a new conception of social welfare and focusing on financial regulation, we assess the performative effects of theories on public policy. We delineate how research that focuses narrowly on questions of efficiency and stability reinforces today’s technocratic financial regulation that undermines social welfare. As a remedy, we outline how future management research can tackle questions of social justice and thereby promote an inclusive approach to financial regulation that better serves social welfare.
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Keywords: critical management studies, deliberation, financial innovations, Habermas, high-frequency trading, income inequality, performativity, social welfare
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