Property Rights and the Organization of Economic Activity by the State

TLDR

In advanced capitalist societies, the state shapes the institutional organization of the economy. The paper argues that by manipulating property rights, the U.S. state gains a previously unrecognized source of strength in economic intervention. The authors analyze how state actions create pressures that prompt actors to seek new economic forms, and how the state assists, leads, or constrains the selection and ratification of these forms, using historical case studies from several industrial sectors.

Abstract

In advanced capitalist society the state helps shape the institutional organization of the economy. We show how the state shapes the economy through the manipulation of property rights. The state's actions create pressures for change that lead actors to look for new forms of economic organization. The state also assists, leads, or constrains the process of selecting new forms of economic organization that emerge in response to these pressures, and it may or may not ratify these new forms. In contrast to the conventional literature on state economy relations that characterizes the U.S. state as having a weak capacity for successful economic intervention, we argue that property rights actions afford the U.S. state a previously unrecognized source of strength. Data come primarily from historical case studies of organizational transformation in the steel, automobile, commercial nuclear energy, telecommunications, dairy, meat-packing, and railroad sectors.