Varieties of Capitalism, Competition, and Prosocial Corporate Purposes

Massimiliano Vatiero, “Varieties of Capitalism, Competition, and Prosocial Corporate Purposes,” in Florence Thépot and Anna Tzanaki (eds.), RESEARCH HANDBOOK ON COMPETITION AND CORPORATE LAW (Edward Elgar Publishing, forthcoming).

18 Pages Posted: 26 Oct 2023 Last revised: 16 Jan 2024

See all articles by Massimiliano Vatiero

Massimiliano Vatiero

University of Trento; Università della Svizzera italiana

Date Written: September 27, 2023

Abstract

The literature on varieties of capitalism identifies two main species of capitalism around the world and over time: armed capitalism, represented by countries with large public corporations having a corporate governance structure characterized by relatively high power of corporate owners and workers, and with product markets having relatively high barriers to entry; and disarmed capitalism, represented by countries with large public corporations that have a corporate governance structure characterized by relatively low power of corporate owners and workers, and with product markets that have relatively low barriers to entry. The following research question arises: Which species (if any) of capitalism is expected to be the most likely to pursue and support prosocial corporate purposes? The underlying idea guiding the argumentations in this chapter is that, as large public companies compete in capital, human capital, and product markets, each species of capitalism may (or may not) attract investors, talents, and consumers, including those with attention to prosocial objectives. This chapter illustrates that there is no one-size-fits-all answer because (the expectations on) the preferences of economic agents, i.e., shareholders, workers, consumers, investors and managers—whether solely interested in profits or also interested in prosocial objectives—play a key role in how different species of capitalism pursue prosocial corporate purposes.

Keywords: varieties of capitalism, competition, corporate governance, controlling shareholder, prosocial corporate purposes

JEL Classification: G30, K22, L22

Suggested Citation

Vatiero, Massimiliano, Varieties of Capitalism, Competition, and Prosocial Corporate Purposes (September 27, 2023). Massimiliano Vatiero, “Varieties of Capitalism, Competition, and Prosocial Corporate Purposes,” in Florence Thépot and Anna Tzanaki (eds.), RESEARCH HANDBOOK ON COMPETITION AND CORPORATE LAW (Edward Elgar Publishing, forthcoming)., Available at SSRN: https://ssrn.com/abstract=4585971 or http://dx.doi.org/10.2139/ssrn.4585971

Massimiliano Vatiero (Contact Author)

University of Trento ( email )

Via Inama, 5
Trento, Trento 38122
Italy

Università della Svizzera italiana ( email )

Via Giuseppe Buffi, n. 13
Lugano, Ticino 6900
Switzerland

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