Ownership, control and economic outcomes

Abstract

Ownership is central to how the economic system operates. Yet the topic is widely neglected. This is particularly surprising given the 2007–2008 credit crunch, which created in 2009 the first global recession since the 1930s. Ownership played a crucial role, from the drive for ‘shareholder value’, through to the mortgages for home ownership used to create new financial instruments. The resulting bad debts were taken on by governments seeking to prevent a collapse of the global and national monetary systems. This transformed the banking crisis into a sovereign debt crisis. Whether a new era of global economic prosperity can be found depends on whether the importance of ownership is recognised, with policies for diversifying ownership forms to create systemic resilience. Copyright 2011, Oxford University Press.