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Finance, Corporate Governance and the New Techno-Economic Paradigm1

Published online by Cambridge University Press:  17 August 2016

Andrew Tylecote  and
Paulina Ramirez
Andrew Tylecote
Affiliation:
University of Sheffield Management School
Paulina Ramirez
Affiliation:
Birmingham University Business School
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Summary

This paper assumes, with Perez (1983, 2002), that technological development follows a ‘long wave’ rhythm, in which new ‘techno-economic paradigms’ succeed one another at long intervals; the latest being the Information and Communication Technology (ICT) paradigm. When the new paradigm appears a tension develops between it and the existing socio-institutional framework. We argue that the financial and corporate governance system (FCGS), is a key element of that framework which is unusually resistant to change. The focus is on the UK FCGS, an outsider-dominated/stockexchange-based system, though with comparisons with the US and with ‘insider-dominated’ economies. Based on fieldwork conducted between 1999 and 2005, we find that Britain is still a long way from witnessing a new creative partnership of financial and industrial capital in most of the economy, needed to fully release the potential of the new paradigm. We discuss what form that might take.

Résumé

Résumé

Ce papier présuppose, avec Perez (1983, 2002), que le développement technologique suit un rhythme d'ondes longues, dans lequel les 'paradigmes techno-économiques' se succèdent à longs intervalles. Le plus récent est celui de l'informatique. Lorsque le nouveau paradigme apparaît, une tension se développe entre celui-ci et le cadre socio-institutionnel existant. Notre argument consiste à montrer que le système financier et de gouvernement d'entreprise (FCGS) constitue un élément clé de ce cadre, exceptionellement résistant au changement. Notre exemple principal est le FCGS britannique, un système 'boursier'/'outsider', que l'on compare aux systèmes américains 'insider'. Sur base d'une étude empirique menée en 1999-2000 et 2005, nous montrons que le Royaume Uni est toujours loin, dans la plupart de l'économie, de voir un nouveau rapprochement créatif entre capital financier et capital industriel qui puisse laisser émerger le potentiel du nouveau paradigme. Nous traçons ensuite un bref aperçu de la forme qu'un tel rapprochement pourrait prendre.

Keywords

système financier et de gouvernement d'entrepriseparadigme technoéconomiquesystème boursier/‘outsider’O16O33P16financial and corporate governance systemtechno-economic paradigmoutsider-dominated/stock-exchange basedO16O33P16
Type
Research Article
Information
Recherches Économiques de Louvain/ Louvain Economic Review , Volume 74 , Issue 4 , 2008 , pp. 583 - 613
Copyright
Copyright © Université catholique de Louvain, Institut de recherches économiques et sociales 2008 

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Footnotes

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[email protected]

1

The empirical research discussed in this paper was conducted within the Corporate Governance and Product Innovation (COPI) project, a research project funded by the Targeted Socio-Economic Research (TSER) program of the European Commission (DG XII) under the Fourth Framework Programme, European Commission (Contract no. SOE1-CT98-1113) coordinated by Andrew Tylecote. We are grateful to the European Commission for its support, and grateful also to two anonymous referees for their comments.

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