The Corporation in the 21st Century

Published by Yale University Press.

ISBN:: 978-0-300-28386-0

In the world of Adam Smith and Karl Marx, capitalists built and controlled mills and factories. That relationship between capital and labor continued in the automobile assembly lines and petrochemical plants of the twentieth century.

But no longer: products and production have dematerialized. The goods and services provided by the leading companies of the twenty-first century appear on your screen, fit in your pocket, or occupy your head. Ownership of the means of production is a redundant concept. Workers are the means of production; increasingly, they take the plant home. Capital is a service bought from a specialist supplier with little influence over customer businesses. The professional managers who run modern corporations do not exert authority because they are wealthy; they are wealthy because they exert authority.

John Kay’s incisive overhaul of our ideas about business redefines our understanding of successful commercial activity and the corporation—and describes how …

In the world of Adam Smith and Karl Marx, capitalists built and controlled mills and factories. That relationship between capital and labor continued in the automobile assembly lines and petrochemical plants of the twentieth century.

But no longer: products and production have dematerialized. The goods and services provided by the leading companies of the twenty-first century appear on your screen, fit in your pocket, or occupy your head. Ownership of the means of production is a redundant concept. Workers are the means of production; increasingly, they take the plant home. Capital is a service bought from a specialist supplier with little influence over customer businesses. The professional managers who run modern corporations do not exert authority because they are wealthy; they are wealthy because they exert authority.

John Kay’s incisive overhaul of our ideas about business redefines our understanding of successful commercial activity and the corporation—and describes how we have come to “love the product” as we “hate the producer.” This is a brilliant and original work from one of the greatest economists.

2 editions

Ben Waber reviewed The Corporation in the 21st Century by John Kay

A Fantastic Economics-Informed Modern Business History

5 stars

Kay provides a sweeping history of the modern firm, informed by deep economics expertise. Ironically the book doesn't get to the 21st century until the end of the book, and the vast majority of the book is from the macro perspective. Boards, legal structure, and firm goals are analyzed from a more or less traditional economics perspective, although Kay does point out many of the faults of these simplified models. Unfortunately there's only a cursory treatment of behavior within the firm, which given that that's the whole point of companies seems like a big oversight (although if the book title were "The Corporate Form in the 21st Century" it would be more understandable). In addition, while Kay provides decent if oblique criticism of the neoliberal turn, he still avoids directly grappling with the massive failures (both professional and ethical) of the leaders of that school, and the less said about …

Kay provides a sweeping history of the modern firm, informed by deep economics expertise. Ironically the book doesn't get to the 21st century until the end of the book, and the vast majority of the book is from the macro perspective. Boards, legal structure, and firm goals are analyzed from a more or less traditional economics perspective, although Kay does point out many of the faults of these simplified models. Unfortunately there's only a cursory treatment of behavior within the firm, which given that that's the whole point of companies seems like a big oversight (although if the book title were "The Corporate Form in the 21st Century" it would be more understandable). In addition, while Kay provides decent if oblique criticism of the neoliberal turn, he still avoids directly grappling with the massive failures (both professional and ethical) of the leaders of that school, and the less said about the sections on religion and minorities the better (they read like they were written in 1960). Overall, however, this book is unmatched in its consideration of the evolution of the corporation and our understanding of how to manage and evaluate them at the macro scale. Highly recommend

Ben Waber

rated it

October 31

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