Monopoly Capital Research Articles

Big Tech Oligopolies, Keith Cowling, and Monopoly Capitalism

Abstract This Special Issue of the Cambridge Journal of Economics (CJE) marks and celebrates forty years since the publication of Keith Cowling’s (1982) seminal Monopoly Capitalism, which synthesised, updated, and extended the earlier work of scholars such as Steindl (1952), Baran and Sweezy (1966), Hymer (1970, 1972) and Kalecki (1971). Since the publication of Monopoly Capitalism, the critical transformative event has been the latest (fourth) technological revolution and the emergence of Big Tech companies such as Facebook, Apple, Amazon, Netflix and Google (aka FAANGs), alongside Microsoft and so-called ‘gig’ or ‘sharing economy’ firms (such as Uber, Airbnb). While initially regarded as exemplars of the dynamics of contemporary capitalism, in recent years there has been a public backlash against Big Tech, and its impact and influence within the global economy. Indeed, several commentators have raised concerns that beneath the veneer of Big Tech lies potentially insidious business models and practices that have led to a rise in corporate power and the monopolisation of markets. These criticisms, however, largely ignore the contributions of earlier scholars of monopoly capitalism. This Special Issue addresses this oversight with a series of papers re-examining and extending the work of Cowling and others in the monopoly capitalism tradition, in the specific context of Big Tech. The Introduction opens with a portrait of Keith Cowling, as a person and his scholarly contribution to the field. It then provides a critical assessment of the papers in this Special Issue. In the Epilogue, we summarise and conclude.

The changing face of anti-trust in the world of Big Tech: Collusion versus Monopolisation

Abstract This paper presents new evidence on two key developments in worldwide anti-trust in the last decade: (i) a downturn in the number of cartels detected by competition authorities and (ii) exponential growth in cases of monopolisation/abuse of dominance. Big Tech firms have been, undoubtedly, the main focus of the latter but almost totally absent in the former. These two developments offer perspectives on the description of Monopoly Capitalism as set out by Keith Cowling 40 years ago. Superficially at least, this seems to deny the prediction of ever-widening collusion, but, on the other hand, it resonates with the prediction of increasingly unassailable dominant firms. We suggest that the two trends can best be understood by the emergence of the Big Tech giants who have established dominance by exceeding tipping points in many markets. In turn, this leads to an alternative form of collusion—‘mutual forbearance’ in which firms back away from aggressive competition in the other giants’ areas of strength. Given this dominance, they do not need collusion—put simply, no sizeable rivals are remaining with whom they need to collude.

Entrepreneurship and digital capitalism: an assessment of corporate power

Abstract I propose verifying whether, in the context of “high-tech” capitalism, large companies have reinforced their control over innovation. The new digital economy has often been associated with the emergence of a market democracy which is favourable to new entrants through the adoption of innovative entrepreneurial approaches. The economic evolution resulting from the digital economy seems to call into question the findings of the theory of monopoly capitalism formulated in the context of industrial capitalism, which gives a central place to giant companies. The identification and exploitation of innovative opportunities were thus considered to be the prerogative of large firms, thus limiting the possibilities of market entry. Based on the analysis of 10,900 patent applications, I demonstrate that the control of innovation by Big Tech companies in the digital industry is stronger than in other industries and less favourable to new entrants.

Increasing returns and business cycles in a family of Goodwinian models with Leontiev technology

The main purpose of this paper is to build a family of tutorial Goodwinian (essentially Marxist) models of capital accumulation through industrial cycles that are less complicated than the author’s models of the extended capitalist reproduction in the USA already published. The subordinate purpose is to advance refinement of these models from the standard “neoclassical” assumptions that distort the generic structures determining perpetual disequilibrium in the reproduction of the aggregate social capital. The ascending from abstract to concrete applies the notion of twofold nature of capitalist production as creation of use value and labour value (prioritizing surplus value). This approach reveals substantial facets of endogenous increasing returns and technological progress induced by capitalist production relations. A three-dimensional Goodwinian model L-1, containing the greed feedback loops, reflects destabilizing cooperation and stabilizing competition of investors. Monopoly capital implements proportional and derivative control over the capital accumulation rate. The growth rate of output per worker directly depends on the growth rates of capital intensity and employment ratio in a technical progress function, whereas the capital-output ratio is constant. Oscillations imitating growth cycles are endogenous. A recession (mild crisis) is a manifestation of relative and absolute over-accumulation of capital. A knife-edge limit cycle maintains a growth cycle with the Kondratiev duration; a more solid limit cycle with a period of about 7.5 years upholds a business cycle with a recession without reduced net output. These limit cycles result from the subsequent supercritical Andronov–Hopf bifurcations. The transformation of the growth cycle into industrial cycle gives credit to raising status of capital-output ratio from auxiliary in L-1 to the level (phase) variable in four-dimensional L-2. A mechanization (automation) function mirrors induced technical progress. L-2 embraces new 11 intensive feedback loops involving capital-output ratio. Proportional and derivative control over this ratio by monopoly capital is taken into account. Pair of supercritical Andronov–Hopf bifurcations gives birth to two limit cycles. The second is a remote analogue for Kuznets cycle with the period of about 18 years; the first upholds the industrial cycle with period of about 7 years and declining net output in the outright crisis. Besides relative and absolute over-accumulation of capital, the specific positive and negative feedback loops containing capital-output ratio are required for crises in industrial cycles. Long-term enhancement of monopoly profit through lowering a targeted domestic capital accumulation rate and diminishing a targeted output-capital ratio is substantiated analytically and validated by computer simulations. The gained insights highlight caveats for hastily policy recommendations.

Governing digital platform power for industrial development: towards an entrepreneurial-regulatory state

Abstract Data and digital platforms have simultaneously upended entrenched positions in some industries, opening-up greater and disruptive competition, while driving overall higher levels of concentration through the growing power of multi-sided digital platforms. The coexistence of rivalry and collusion – a key feature of Cowling’s monopoly capitalism – persists and takes new forms in the digital economy. Taking into account the heterogenous nature of platforms, this paper analyses the relationships between large digital platforms and the development of industrial capabilities, especially in middle-income countries and the implications for industrial and competition policies. We advance an analytical-policy framework connecting the different dimensions and sources of platform power responsible for value capture and extraction, and the different platform capability-functions responsible for value creation. Building on this recasting of Hymer’s ‘efficiency contradiction’ and Cowling theory of monopoly capitalism, we advance an integrated industrial-competition policy approach to overcome it and propose a conception of an ‘entrepreneurial-regulatory state’. Complementary industrial and competition policies are required to foster optimal rivalry, being a rivalry which rewards the development of dynamic capabilities and enables contestation by different business models.

Advertising and the consumer in the age of Big Tech: a new moment in the evolution of monopoly capitalism?

AbstractThe monopoly capitalism literature has traditionally approached advertising from the vantage point of its role in sustaining the economic order. However, digitalised forms of advertising in contexts dominated by giant digital platform technology companies like Google, Facebook and Amazon are disrupting the existing order through a combination of subsidy and location effects, shored up by the capabilities of the new technology for real-time data collection on users. This poses significant challenges for theory and policy. In both respects the case is made for rehabilitating the earlier approach of Nicholas Kaldor, which emphasises both heterogeneity of advertising forms and questions of subsidy, to complement the dominant approaches of the monopoly capitalism school as exemplified by Paul Baran and Paul Sweezy on one side, and Keith Cowling on the other.

Media power in digital Asia: Super apps and megacorps.

Tracing global shifts in ownership and conglomeration in the media and technology sectors, this introduction analyzes the emergence of the 'megacorp' and 'super app' as distinct forms and sites of media power. With a focus on Asia, we argue that the pairing of megacorps and super apps is driving the emergence of powerful digital companies that shape social, cultural, and political dynamics worldwide. Through analyses of companies including Reliance, SoftBank, Tencent, Alibaba, and Transsion, this special issue calls for a renewed engagement with theories of monopoly capital via the megacorp, and accounts of consumer and citizen experiences of this monopoly via a quotidian touch point, the super app. In conversation with scholarship on conglomerates, monopolies, and platforms as key institutional forms of media power, we show that media power in this digital conjuncture operates as much through national and regional differences as through the imperative to achieve a global scale.

Monopoly capitalism in the past four decades

Abstract Monopoly capitalism can be seen as ‘actually existing neo-liberalism’, and the ‘worship of markets’ from doctrines of neo-liberalism operates to support monopoly capitalism. In recent decades, there has been an evolution from forms of national monopoly capitalism to transnational monopoly capitalism. Aspects of the processes of financialisation are explored for relevance for the evolution of monopoly capitalism. Recent trends in concentration and market power are consistent with the monopoly capitalism analysis, and review the links with profitability and investment. Ideas of secular stagnation have long been associated with monopoly capitalism, and that association is revisited in light of recent economic experience.

Monopoly Capital in the time of digital platforms: a radical approach to the Amazon case

Abstract The paper applies the radical view of Monopoly Capitalism to the digital platform economy. Based on the seminal ideas of Hymer and Zeitlin that led Cowling and Sugden to define the large monopolistic firm as a means to plan production from a single strategic decision-making centre, we attempt to develop a framework where digital platforms are conceived as an evolution of large transnational corporations. Power and control, in our view of monopoly capitalism, are thus to be understood not only in terms of market relations, but rather as levers for coordinating global production and influencing world societies. Applying this framework to the Amazon case, we highlight the key analytical dimensions to be considered: not only does Amazon dominate other firms and suppliers through its diversification and direct control of data and technology; its power is also linked to global labour fragmentation and uneven bargaining power vis-à-vis the world’s governments, as in the tradition set by Hymer and Cowling.

Electing to electrify: unpacking the local crisis and state response in Sun Valley, Soweto

ABSTRACT This article draws from a wider research project on ‘Energy Racism’ to explore the experiences and perspectives of ordinary residents in Sun Valley, Soweto (in Ward 22). From August 2020, due to a broken electricity transformer, residents of Sun Valley suffered in the dark. They employed many strategies to access energy and called a range of meetings with ANC councillors and Eskom officials, but their pleas fell on deaf ears until they threatened to boycott the 2021 local government elections. President Cyril Ramaphosa then announced that the problem would be resolved and suddenly, in a clear-cut drive to secure votes, the transformers were fixed within days of the 1 November election. We argue that the decision to electrify Sun Valley is part of the strategy of ‘energy racism’ since it relies upon and assumes that the Black working class will continue to bear the burden of the electricity crisis. Building upon the notion of racial capitalism, the article suggests that mainstream political parties in South Africa promote the systemic exclusion of townships and informal settlements until the precise moment that it becomes necessary for authorities (the Black faces of white monopoly capital) to cash in on their piecemeal inclusion.

Abolitionist Pedagogies, Pedagogical Labor

Abolitionist Pedagogies, Pedagogical Labor

Digital technologies, gig work and labour share

Abstract Conflict over the functional income distribution, discussed and explained in Keith Cowling’s work in the 1980s, remains a feature of capitalist economies. In the twenty first century labour flexibilisation strategies have become a key tool in enabling monopoly capitalists to manipulate the functional distribution of income. Through the lens of institutional theory, this paper traces labour flexibilisation in the UK since the 1980s, in order to describe and evaluate how the use of digital technologies has become allied to non-standard contracting and ‘dependent’ self-employment in the growth of the gig economy. The paper argues that this provides employers with increased flexibility of the labour input at both extensive and intensive margins. Digital technology and gig working also position dominant internet platform businesses to apply downward pressure to labour share at a monopoly-monopsony nexus between individual consumers and new service sector workers. This has led to new ways in which employment contracts and the nature of organisations as an outcome of monopoly capitalist labour process are contested.

Digital platforms: monopoly capital through a classical-marxian lens

Abstract The classical-marxian conception of capitalist monopoly, based on restrictions to capital mobility arising from production conductions and property rights rather than oligopolistic market structure, is a fruitful way of approaching the implications of the pervasive spread of modern corporations—what has been termed the stage of Monopoly Capital. The relevance of the classical-marxian conception of ‘capitalist monopoly’ in the context of new technology is investigated by applying it to the monopoly exercised by contemporary digital platforms, with a specific focus on Google (Alphabet), Amazon and Facebook.

Peripheral financialisation and monopoly capitalism in Nigeria: the case of the Dangote Business Group

Abstract This article examines financialisation of non-financial corporations (NFCs) in developing countries using the example of the Dangote Business Group in Nigeria, the largest conglomerate on the Nigeria Stock Exchange (NSE). Our findings suggest that Nigeria is characterised by a financialisation process, where speculative activities expand in banking and capital markets, but not in manufacturing NFCs. Macro-financialisation in banking and capital markets does little to provide finance for Nigeria’s manufacturing NFCs. In the face of insufficient financing from banks and the capital market, NFCs rely on internal funding and trade credit within diversified business groups (DBGs). At the firm level, the financial accounts of Nigerian manufacturing NFCs such as the Dangote Group show weak evidence of speculative financial activities and high levels of investment in productive capacity. This results from a combination of volatile capital markets with excessive risk for NFCs and profitable opportunities in the real economy. While these two factors curtail the negative implications of speculative macro-financial activities, monopoly capitalist concentration processes in DBGs work to undermine effective demand through the disproportionate allocation of profit at the expense of wages.

The Continuing Value of Harry Braverman’s Labor and Monopoly Capital

Harry Braverman’s Labor and Monopoly Capital (1974) was widely acknowledged to be a significant intervention in the debate on the political economy of work within contemporary capitalist societies. Despite the radicalism of some initial contributors, over time a new orthodoxy hostile to the Marxist foundation of Braverman’s work was established so that today his influence has waned. His legacy is largely restricted to a simplified and linear theory of the labour process, with the focus that work under capitalism is subject to a dynamic of deskilling. The richness of Braverman’s contribution and observations on issues of political economy, such as the separation of ownership and control, class relations, and the reserve army of labour, subjects of initial discussion and criticism, are ignored. The paper summarizes the major themes in Braverman’s work, and challenges many of the criticisms made since its publication. It also discusses some limitations, including those deriving from Braverman’s complex relation to Paul Baran and Paul Sweezy’s political economy, confusion regarding the position of the ‘middle layers’ within employment, and the absence of a sufficiently nuanced account of labour markets. Finally, it addresses some of the changes to capitalism since Braverman’s day, arguing that contemporary labour processes can be best explored through an engagement with his pioneering work.

The Stack as an Integrative Model of Global Capitalism

This paper investigates recent transformations in global capitalism’s political economy, concerned with the evolution of globally integrated production and exchange apparatuses, such as platforms, enabled through technological advances in computational infrastructures. These infrastructures are explicable in terms of the model of the Stack, understood as an accidental mega-structure of the contemporary platform economy that is integrating previously detached circulation and accumulation structures. The Stack is introduced as an integrative model of a multi-layered political economic system that allows to understand and explain recent developments in global capitalism. Focus is thereby given to intensified real abstraction of labour induced by the capitalist appropriation of planetary-scale computation. Building on the model of the Stack, we set in relation different perspectives on recent capitalist development in terms of planetary-scale computation: transnational informational capitalism, cognitive capitalism, intellectual monopoly capitalism and techno-feudalism. Thereby we highlight aspects of value creation as well as rent-seeking through the model of the Stack.

Avoiding the Delusions of Today’s Capitalism with a Thorough Understanding of Marxism as the Key

ABSTRACT Between the early 1970s, when neoliberalism was in full swing and became the dominant rhetoric of the time, and the 2008 global economic crisis, capitalism as a result of its inherent nature entered a fundamental crisis with unavoidable consequences. Many in-depth analyses of the economic crisis from a Marxist viewpoint have revealed that in the area of wealth appropriation, capitalism has now exacerbated inequality to absurd levels. This is not to mention other challenging issues such as the parasitic nature of increasingly digitized finance capital, uncontrolled inflation leading to rampant financial deficits, the worsening ecological crisis with mounting environmental costs that erode profits, escalating political manipulation by monopoly capitalists, and the mounting by developed countries of inappropriate military interventions in the developing world, to name just a few. Today, the fundamental characteristics and specific manifestations of contemporary capitalism are exerting significant impacts on the process of building socialism worldwide. Faced with today’s capitalism, China and Vietnam while exercising due caution must put forward and consistently highlight the need to examine the direction the system is taking. Thorough research on this subject is critical for a correct scientific understanding.

Socialism and Ecological Survival: An Introduction

Time is running out for humanity to avoid a catastrophic planetary tipping point. Widespread mass mobilizations of populations worldwide must fight to bring about revolutionary societal changes and dismantle neoliberal monopoly capitalism, with its reliance on extractive exploitation of our planet's resources and communities.

The Trend to Widening Wealth and Income Inequality in Sweden and its Causes

Sweden is a model of social democracy in which the Social Democratic Party has long been in power, and in which distribution under the conditions of monopoly capitalism has been the object of one-sided praise. Wealth and income inequality in Sweden was in the past relatively low, but in recent years has shown a tendency to undergo a structural increase, and some indicator values are already at comparatively high levels. Investigating the causes, we find that the ownership structure of the means of production, dominated by monopoly capitalist private ownership, has played a decisive role in the creation and evolution of wealth and income inequality within Sweden. The Swedish welfare system, whose core elements are social security provisions and the tax system, has played an important role in alleviating wealth and income inequality and in promoting social equity, but the degree of adjustment it achieves is relatively limited, and it now faces challenges in ensuring its sustainability. In recent years, the weakening of the organizational strength of trade unions in Sweden has resulted in an imbalance between the power of labor and capital, an imbalance that to some extent has promoted the widening of wealth and income inequality. With the deepening of the basic contradiction of capitalism, the trend to widening wealth and income inequality in Sweden represents a historical inevitability.

The Life of a Film: Medianatures, Camphor, and the Ideology of Technological Modernity

By analyzing the discourse of film trade journals from the early twentieth century on "the life of a film" and examining newsreel footage of camphor extraction in Formosa (now Taiwan), this article argues that the value of film as media has been overdetermined by the ideology of scientism and monopoly capitalism, or what might be called technological modernity. Technological modernity understands media such as film in a way that produces a separation between nature and culture while also creating global processes of racialization or dehumanization. I use the term medianatures as a way to connect these severed threads so that it's possible to be more attentive to the various everydays involved in the production of film, from camphor workers in Formosa to factory workers in New Jersey and even to camphor trees themselves.