Please join us for our next CSES Lecture Series on April 17th, 2014 at Cornell University from 4:30 to 6:00PM in the A.D. White House, Guerlac Room. Monica Prasad will present her research “Is Neoliberalism Over?”
Abstract
By neoliberalism I mean a set of policies built around a faith in the free market, and a strong distrust of state intervention. In the United States, we have witnessed a rise in policies of this sort in the last three decades, starting with the presidency of Ronald Reagan. In his first inaugural address Reagan said quote “government is not the solution to our problem; government is the problem”; in his lighter moments, Reagan’s joke was “The nine most terrifying words in the English language are: I’m from the government, and I’m here to help.” Reagan’s anti-government approach to government has been a stable presence in American politics ever since. We saw it catch fire again under the presidency of George W. Bush, and we have seen it flare up most recently in the rise of the Tea Party. But there are reasons to wonder whether this era of American neoliberalism might be drawing to a close. For example, nearly half of the American public now holds a negative image of the Tea Party and its extreme anti-government stance, compared with only a third who view it favorably. And Republicans have lost the popular vote in five of the last six presidential elections, and they hold one house of Congress today partly thanks to gerrymandering. So, has this era of American history come to a close? Is neoliberalism over?
About the Speaker
Monica Prasad’s areas of interest are economic sociology, comparative historical sociology, and political sociology. Her book The Politics of Free Markets (University of Chicago Press, 2006) won the 2007 Barrington Moore Award from the American Sociological Assocation’s (ASA) section on comparative and historical sociology. Prasad has also published an edited volume on the sociology of taxation, co-edited with Isaac Martin and Ajay Mehrotra, called The New Fiscal Sociology: Taxation in Comparative and Historical Perspective (Cambridge University Press, 2009). Her most recent book is The Land of Too Much: American Abundance and the Paradox of Poverty (Harvard University Press, 2012), which has received three awards, including the 2013 Barrington Moore Award and the Viviana Zelizer Award from the ASA section on economic sociology. Prasad is the recipient of several awards including a Fulbright to the Institut d’Etudes Politiques in Paris in 2011 and a Frederick Burkhardt Residential Fellowship from the American Council of Learned Societies also in 2011. She received a National Science Foundation Faculty Early Career Development Award in 2009. With this funding, she and project manager Elisabeth Anderson are conducting a cross-national and longitudinal study of the relationship between income tax progressivity and welfare state spending. Prasad’s most recent book The Land of Too Much develops a demand-side theory of comparative political economy to explain the surprisingly large role of the state in the United States, its origins in the 19th-century revolution in agricultural productivity, and its consequences for undermining a European-style welfare state and leaving U.S. economic growth dependent on “mortgage Keynesianism.” She is currently researching a book manuscript on the Reagan-era tax cut of 1981 and conducting investigations into several aspects of taxation and development with graduate students.
The Economy & Society Interview Series is a casual yet intellectually engaging conversation with leading scholars throughout the social sciences. The interview series is produced by the Center for the Study of Economy and Society (CSES) at Cornell University. In this interview, Gerald F. Davis–the Wilbur K. Pierpont Collegiate Professor of Management at the Ross School of Business and Professor of Sociology, The University of Michigan–discusses his educational background, research trajectory, recent book and empirical findings, insights into sociology and economics, and future trends in research.
Please join us for our next CSES Lecture Series on March 27th, 2014 at Cornell University from 4:30 to 6PM in the A.D. White House, Guerlac Room. Marion Fourcade will present her research “Classification Situations: Life-Chances in the Neoliberal Era.”
Abstract
This article examines the stratifying effects of economic classifications. We argue that in the neoliberal era market institutions increasingly use actuarial techniques to split and sort individuals into classification situations that shape life-chances. While this is a general and increasingly pervasive process, our main empirical illustration comes from the transformation of the credit market in the United States. This market works as both as a leveling force and as a condenser of new forms of social difference. The U.S. banking and credit system has greatly broadened its scope over the past twenty years to incorporate previously excluded groups. We observe this leveling tendency in the expansion of credit amongst lower-income households, the systematization of overdraft protections, and the unexpected and rapid growth of the fringe banking sector. But while access to credit has democratized, it has also differentiated. Scoring technologies classify and price people according to credit risk. This has allowed multiple new distinctions to be made amongst the creditworthy, as scores get attached to different interest rates and loan structures. Scores have also expanded into markets beyond consumer credit, such as insurance, real estate, employment, and elsewhere. The result is a cumulative pattern of advantage and disadvantage with both objectively measured and subjectively experienced aspects. We argue these private classificatory tools are increasingly central to the generation of “market-situations”, and thus an important and overlooked force that structures individual life-chances. In short, classification situations may have become the engine of modern class situations.
About the Speaker
Marion Fourcade received her PhD from Harvard University (2000) and taught at New York University and Princeton University before joining the Berkeley sociology department in 2003. A comparative sociologist by training and taste, she is interested in variations in economic and political knowledge and practice across nations. Her first book, Economists and Societies (Princeton University Press 2009), explored the distinctive character of the discipline and profession of economics in three countries. She is now working on a second book, tentatively called Measure for Measure: Social Ontologies of Classification, which examines the cultural and institutional logic of what we may call “national classificatory styles” across a range of empirical domains. Current studies for this book include environmental valuation, the digitization of books and the classification of wines in France and the United States. Other ongoing research focuses on the role of the credit market in social stratification (with Kieran Healy); the comparative study of political organization (with Evan Schofer and Brian Lande); the microsociology of courtroom exchanges (with Roi Livne); and the role of business schools in the neoliberal turn (with Rakesh Khurana).
Please enjoy our CSES Lecture Series event on February 6th, 2014 at Cornell University at the A.D. White House, Guerlac Room. Gerald (Jerry) Davis presented his research “The Coming Collapse of the American Corporation (and What Comes Next)?”
Abstract
Shareholder-owned corporations were the central pillars of the US economy in the twentieth century. Due to the success of the shareholder value movement and the widespread “Nikefication” of production, however, public corporations have become less concentrated, less integrated, less interconnected at the top, shorter-lived, and less prevalent since the turn of the twenty-first century, and there is reason to expect that their significance will continue to dwindle. We are left with both pathologies (heightened inequality, lower mobility, and a fragmented social safety net) and new technologies suitable for being re-purposed in more democratic forms. Local solutions for producing, distributing, and sharing can provide functional alternatives to corporations for both production and employment; what is needed is the social organization to match the tools that we already have, or will have shortly. The time for democratic local economic forms prophesied by generations of activists may finally be at hand.
About the Speaker
Jerry Davis is the Wilbur K. Pierpont Collegiate Professor of Management at the Ross School of Business and Professor of Sociology, The University of Michigan. Davis received his PhD from the Graduate School of Business at Stanford University. Recent books include Social Movements and Organization Theory (with Doug McAdam, W. Richard Scott, and Mayer N. Zald; Cambridge University Press, 2005) and Organizations and Organizing: Rational, Natural, and Open System Perspectives (with W. Richard Scott; Pearson Prentice Hall, 2007). Davis has published widely in management, sociology, and finance. He is currently Editor of Administrative Science Quarterly and Co-Director of the Interdisciplinary Committee on Organization Studies (ICOS) at Michigan. Davis’ research is broadly concerned with corporate governance and the effects of finance on society. Recent writings examine how ideas about corporate social responsibility have evolved to meet changes in the structures and geographic footprint of multinational corporations; whether “shareholder capitalism” is still a viable model for economic development; how income inequality in an economy is related to corporate size and structure; why theories about organizations do (or do not) progress; how architecture shapes social networks and innovation in organizations; why stock markets spread to some countries and not others; and whether there exist viable organizational alternatives to shareholder-owned corporations in the United States. His latest book Managed By the Markets: How Finance Reshaped America (Oxford University Press, 2009) examines how finance replaced manufacturing at the center of the American economy, and what the consequences have been for corporations, banking, states, and households in the 21st century. In 2010 it was awarded the Academy of Management’s George R. Terry Book Award for Outstanding Contribution to the Advancement of Management Knowledge.
The high-tech digital economy has firmly established its position as a key driver of economic growth, one where small start-up tech firms are vital drivers of innovation and regional economic development. Open access to technological knowledge and an increasingly educated labor pool—with expertise in data engineering and communication technologies—have dramatically lowered the entry barriers to the high-tech digital economy. As a result, success-factors of tech start-ups have changed over time. Whereas the success of Silicon Valley was based on the technological edge of highly educated and closely connected engineers and computer scientists, new start-up entrepreneurs in this sector today emphasize the more important role of existing industry ties and the tailor-made application of their new technologies. As a consequence, high-tech development depends increasingly on close links with other industries, to develop and exploit novel and innovative applications. For example, EdTech and FinTech companies are currently at the forefront of this development.
The comparative advantage of metropolitan areas relies increasingly on entrepreneurs founding small-scale digital information and high-tech start-ups, providing essential services and tools for a rapidly changing knowledge based economic development. Not only do the IT and digital industries emerge as a new powerful sector, but also contribute to the development of new networks of innovation—which in turn help to revolutionize established industries. The proposed project, therefore, aims to explain the relationship between entrepreneurial activities and the emergence of high-tech clusters in the New York City metropolitan region.
Studying such phenomenon close to its emergence is of utmost importance, and leads to deeper understanding of the factors that produce successful entrepreneurship and growth in high-tech clusters. At the turn of the new century, relatively few tech start-ups were located in New York City (NYC). Silicon Valley, New England, LA/Orange County, San Diego and even upstate New York far outstripped the New York metropolitan area in tech start-ups. From 2007 to 2011, however, high tech start-ups in NYC grew by 32% during a severe economic recession when other regions experienced sharp declines in venture capital investments. The rate of founding of tech start-ups in NYC more than tripled over the last decade, making the metropolitan area the fastest growing knowledge-based economy in the United States.
The rapid growth of the high-tech economy in NYC cannot be explained by overall economic growth, especially given that the NYC financial industry was the epicenter of the most serious financial crisis since the Great Depression. Why did New York City, particularly Manhattan, experience such explosive growth in high tech start-ups at the outset of a major economic downturn?
Our Approach
Our interdisciplinary approach—including teams of sociologists and economists—focuses analytic attention on institutions in the making of a knowledge-based regional economy. In explaining the rise of regional centers of knowledge-based economic development, our approach explores the institutional drivers of successful entrepreneurial activity. We plan to conduct basic research on knowledge-based economic development near to the timing of emergence, with a focus on the social mechanisms and institutional processes enabling and promoting this new wave of entrepreneurship.
Preliminary research has shown significant evidence of cluster formation in the concentration of tech start-up firms in lower Manhattan. This pattern of cluster formation is consistent with the view that dense networks of like-minded actors and norms of reciprocity are important causal factors in the emergence of trust and cooperation, which we hypothesize enables and guides the emergence of NYC’s tech start-up economy.
Broader Implications
The proposed study is novel because it aims to examine the dynamics of the emergence of spatially concentrated entrepreneurial activity and rapid growth in the founding of tech start-up firms in the New York City metropolitan area.
Project findings will be disseminated through progress reports, and will be provided to all individuals taking part in the study—including NYC entrepreneurs, incubators, accelerators, venture capitalists, angel investors, and local administrative agencies, etc. Additionally, we plan to submit academic publications to the leading peer-reviewed journals and to Harvard University Press.
Project Support
“We are pleased to support research spearheaded by Cornell’s CSES examining the technology sector in cities like New York. In New York City, the growing technology sector continues to diversify and strengthen the City’s economy, creating jobs across a spectrum of related industries and generating critical economic activity and opportunities at all levels throughout the five boroughs. This exciting body of work has the potential to inform policymakers, practitioners, and other stakeholders looking to encourage the growth of tech clusters in cities around the world by suggesting potential strategies and best practices. We look forward to our continued partnership with Professor Nee and CSES, and eagerly await the results of this promising research project.”
-NYC Economic Development Corporation
“NY Tech Meetup is pleased to support the research examining the growth of New York’s technology sector being conducted by Cornell’s CSES. We have been part of the New York technology ecosystem for the past decade, during which time we have witnessed tremendous growth in the tech community as a whole and in our own organization. We believe that research of this type is key to informing and influencing policy and future growth in a way that benefits all of New York’s citizens. We look forward to continuing to work with Cornell and Professor Nee on this project.”
-NY Tech Meetup
“We, at ERA, think the project being conducted by Cornell’s Center for the Study of Economy and Society would be helpful for NYC and we look forward to the research findings and how these findings can be leveraged to improve NY’s start-up ecosystem further by attracting capital, human and technical resources in to the city.”
-Entrepreneurs Roundtable Accelerator
“We are delighted to see CSES’s commitment to understanding the organic development of the technology industry in New York. We believe this market is in an extraordinary period of creativity and collegiality. We are fortunate to have been a part of this community from the beginning and proud to be associated with so many great entrepreneurs, innovators, co-investors management teams, and now academic researchers.”
-RRE Ventures
“We think this project has the potential to provide a lot of insight into the growth and success of the NY tech community. We are really excited to see the data and hear the conclusions the team at the Center for the Study of Economy and Society draws from it.”
-Gotham Ventures
“General Assembly’s history is deeply intertwined with other New York city startups, the city of New York and the growing needs of a knowledge-based economy. Our mission to build a community of individuals empowered to pursue the work they love has been fueled in part by the growth of the NYC tech ecosystem. This research has the potential to inform the future growth of NYC and other major economic centers. We’re delighted to participate and see the conclusions that the CSES team draws from their work.”
Please join us for our next CSES Lecture Series on February 6th, 2014 at Cornell University from 4:30 to 6PM in the A.D. White House, Guerlac Room. Gerald (Jerry) Davis will present his research “The Coming Collapse of the American Corporation (and What Comes Next)?”
Abstract
Shareholder-owned corporations were the central pillars of the US economy in the twentieth century. Due to the success of the shareholder value movement and the widespread “Nikefication” of production, however, public corporations have become less concentrated, less integrated, less interconnected at the top, shorter-lived, and less prevalent since the turn of the twenty-first century, and there is reason to expect that their significance will continue to dwindle. We are left with both pathologies (heightened inequality, lower mobility, and a fragmented social safety net) and new technologies suitable for being repurposed in more democratic forms. Local solutions for producing, distributing, and sharing can provide functional alternatives to corporations for both production and employment; what is needed is the social organization to match the tools that we already have, or will have shortly. The time for democratic local economic forms prophesied by generations of activists may finally be at hand.
About the Speaker
Jerry Davis is the Wilbur K. Pierpont Collegiate Professor of Management at the Ross School of Business and Professor of Sociology, The University of Michigan. Davis received his PhD from the Graduate School of Business at Stanford University. Recent books include Social Movements and Organization Theory (with Doug McAdam, W. Richard Scott, and Mayer N. Zald; Cambridge University Press, 2005) and Organizations and Organizing: Rational, Natural, and Open System Perspectives (with W. Richard Scott; Pearson Prentice Hall, 2007). Davis has published widely in management, sociology, and finance. He is currently Editor of Administrative Science Quarterly and Co-Director of the Interdisciplinary Committee on Organization Studies (ICOS) at Michigan. Davis’ research is broadly concerned with corporate governance and the effects of finance on society. Recent writings examine how ideas about corporate social responsibility have evolved to meet changes in the structures and geographic footprint of multinational corporations; whether “shareholder capitalism” is still a viable model for economic development; how income inequality in an economy is related to corporate size and structure; why theories about organizations do (or do not) progress; how architecture shapes social networks and innovation in organizations; why stock markets spread to some countries and not others; and whether there exist viable organizational alternatives to shareholder-owned corporations in the United States. His latest book Managed By the Markets: How Finance Reshaped America (Oxford University Press, 2009) examines how finance replaced manufacturing at the center of the American economy, and what the consequences have been for corporations, banking, states, and households in the 21st century. In 2010 it was awarded the Academy of Management’s George R. Terry Book Award for Outstanding Contribution to the Advancement of Management Knowledge.
Sonja Opper (Gad Rausing Professor of Economics and CSES Fellow) and Victor Nee (Frank and Rosa Rhodes Professor and CSES Director) were awarded a $1,075,000 grant from Sweden’s Marianne and Marcus Wallenberg Foundations for their three-year US, Swedish and Chinese comparative project, “The Making of Knowledge-Based Metropolitan Economies: IT-Start-ups in International Comparison”.
Finance, Corporations and the End of Neo-Liberalism
4:30-6:00PM
A.D. White House, Guerlac Room
Please join us for the 2013-2014 CSES Lecture Series entitled: “Finance, Corporations and the End of Neo-Liberalism.” Our Lecture Series brings to Cornell University campus leading scholars in the social sciences. This CSES Lecture Series is co-sponsored by the Society for the Humanities, Program on Ethics and Public Life, and Department of Sociology.
February 6th, 2014, 4:30pm
A.D. White House–Guerlac Room
Jerry Davis, University of Michigan
The Coming Collapse of the American Corporation (and What Comes Next)?
March 27th, 2014, 4:30pm
A.D. White House–Guerlac Room
Marion Fourcade, Berkeley
Classification Situations: The Productive Effects of Financial Classifications
April 17th, 2014, 4:30pm
A.D. White House–Guerlac Room
Monica Prasad, Northwestern
Is Neo-Liberalism Over?
“Economic action is ‘social’ insofar as its subjective meaning takes account of the behavior of others and is thereby oriented in its course.”— Max Weber
