Shareholder value policies spread unevenly, aided by institutional preconditions and safety-in-numbers timing

Evidence

Whereas regime of accumulation scholars consider financialization a global phenomenon, driven by the hegemonic financial power of the USA, scholars of shareholder value have moreconsideration for the institutionaldiversityof national political economies. Early scholarship on financialization suggested that shareholder value policies would be more likely to be adopted in political economies that fulfil three preconditions for financialization: the existence of value-oriented investors, opportunities for value investment and management prerogatives that allow for labour shedding (Froud et al., 2000, p. 105). Recent scholarship, however, has revealed that not all of these conditions need to be fulfilled for the spread of shareholder value policies. Research on Japan and Germany has shown that shareholder value is more likely to be adopted by internationally oriented corporations than those embedded in local institutions (Ho¨pner, 2003; Ahmadijan and Robbins, 2005). Moreover, timing seems to be a pivotal factor in overcoming theinstitutionalhurdlestothedissemination ofshareholdervalueoutsidetheUSA. For instance, Ahmadijan and Robinson (2001) have found that once a few firms adopt shareholder value policies, other corporations feel more comfortable to follow—a pattern the authors call ‘safety-in-numbers’. — Natascha van der Zwan, Making Sense of Financialization, 60

Categorization

• XREF: The ‘safety-in-numbers’ contagion dynamic echoes diffusion-of-innovations literature and bandwagon effects familiar from institutional theory. — connects to: Investor-style valuation techniques now shape public policy with coercive force — Ève Chiapello, Financialisation of Valuation, 108; Shareholder-value maximization went unanswered by any countervailing force — Shoshana Zuboff, The Age of Surveillance Capitalism, 570; German firms deployed shareholder-value rhetoric symbolically without full implementation — Natascha van der Zwan, Making Sense of Financialization, 49 (+1 more)
• corroborated: 2 independent passages support this claim — Natascha van der Zwan, Making Sense of Financialization, 60

Related

• German firms deployed shareholder-value rhetoric symbolically without full implementation (similarity 0.79)

Broader Connections

• Financialization theory links wage-compromise collapse and shareholder value to inequality #expands (0.75) — Natascha van der Zwan, Making Sense of Financialization, 109