Structuring Power: Business and Authority Beyond the Nation-State – with Abraham Newman

What is the relationship between globalization and the political power of business? Much of the existing literature focuses on the ability of mobile capital to threaten exit in order to press for more business friendly rules. In this article, we refine arguments about exit options in global markets by arguing that the relative exit options available to business and other actors are neither fixed, nor exogenous consequences of some generically conceived process of globalization. Instead, they themselves are the result of struggles between actors with different interests and political opportunities. Since exit options play a crucial role in determining the relative structural power of business vis-à-vis other actors, we dub the power to shape exit options structuring power, distinguishing it from structural power, and argue that it is crucial to explaining it. We identify two channels through which actors can shape exit options – extending jurisdictional reach and reshaping the rules of other jurisdictions – and the factors that will make regulators and business more or less capable of exercising structuring power. We then use two exploratory case studies – one involving privacy regulation, the other accountancy standards – to illustrate how structuring power can work to shape exit options, and thus structural power. We conclude by considering the relationship between structuring power, structural power, and the existing literature in comparative and international political economy.

Henry Farrell and Abraham Newman (2015), “Structuring Power: Business and Authority Beyond the Nation-State,” Business and Politics, 17,3:527-552.

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Essay

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How can democratic societies protect—and protect themselves from—the free flow of digital information? The Internet was going to set us all free. At least, that is what U.S. policy makers, pundits, and scholars believed in the 2000s.  The Internet would undermine authoritarian rulers by reducing the government’s stranglehold on debate, helping oppressed people realize how ...
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Chapter in an Edited Volume

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The debate about the industrial districts of central and north-eastern Italy has evolved over the last 25 years. Initially, many saw them as evidence that small firms could prosper contrary to the arguments of the proponents of big industry. Debate focussed on whether small firm industrial districts had a genuine independent existence, or were the ...
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