IDEAS home Printed from https://ideas.repec.org/a/bpj/aelcon/v11y2021i1p53-64n2.html
   My bibliography  Save this article

Capitalization and its Legal Friends

Author

Listed:
  • Wansleben Leon

    (Max Planck Institute for the Study of Societies, Koln, Germany)

Abstract

Katharina Pistor’s argument in The Code of Capital about the constitutive role of legal practice for the creation and distribution of wealth requires contextualization; her claims about the stand-alone role of law in determining the political economy of global capitalism are exaggerated. My first intervention concerns the concept of capital. Capital evidently is not just a legal code, but also constitutes a financial accounting entity that emerges from processes of investment, which are embedded in (economic, social, political) structures that are facilitative of unequal distributions of rewards and risks. Legal coding should be considered as part of such ‘capitalization’ and as becoming more critical in the contemporary economy, in which capitalization increasingly happens through financial engineering and through capturing rents from ‘intangible capital’. Secondly, we can only understand the distributional implications of legal coding if we recognize a) the importance of rent-seeking in secularly stagnating economies and b) the particular class configurations in what Milanovic, B. (2019). Capitalism, alone. Cambridge, MA: Harvard University Press calls ‘liberal meritocratic capitalism’. The consolidation of a capital-rich and hard-working upper class in such a capitalist formation (the extreme case being United States) not just indicates a close alliance or overlap between holders of wealth and the professions (fund managers, legal advisers etc.) that serve them. It also indicates that social class structures – the paths of socialization they reproduce; their in-built social sorting mechanisms; their close association with ideologies of legitimate privilege – play a key role in reproducing economic distributional outcomes.

Suggested Citation

  • Wansleben Leon, 2021. "Capitalization and its Legal Friends," Accounting, Economics, and Law: A Convivium, De Gruyter, vol. 11(1), pages 53-64, March.
    • Handle: RePEc:bpj:aelcon:v:11:y:2021:i:1:p:53-64:n:2
    DOI: 10.1515/ael-2020-0063
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/ael-2020-0063
    Download Restriction: Download restriction for institutions: For access to full text, subscription to the journal is required. Individual readers who register with De Gruyter Online get free access.
    File URL: https://libkey.io/10.1515/ael-2020-0063?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Levy, Jonathan, 2017. "Capital as Process and the History of Capitalism," Business History Review, Cambridge University Press, vol. 91(3), pages 483-510, October.
    2. Herman Mark Schwartz, 2019. "American hegemony: intellectual property rights, dollar centrality, and infrastructural power," Review of International Political Economy, Taylor & Francis Journals, vol. 26(3), pages 490-519, May.
    3. Eve Chiapello, 2007. "Accounting and the birth of the notion of capitalism," Post-Print hal-00466515, HAL.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ashwath Komath, 2022. "Bancor Comes of Age: A Case for an Indian Bitcoin Reserve," India Quarterly: A Journal of International Affairs, , vol. 78(1), pages 121-142, March.
    2. A. J. ARNOLD & S. McCARTNEY, 2011. "‘Veritable gold mines before the arrival of railway competition’: but did dividends signal rates of return in the English canal industry?," Economic History Review, Economic History Society, vol. 64(1), pages 214-236, February.
    3. Chiapello, Eve, 2008. "Accounting at the heart of the performativity of economics," economic sociology. perspectives and conversations, Max Planck Institute for the Study of Societies, vol. 10(1), pages 12-15.
    4. Chiapello, Eve, 2017. "Critical accounting research and neoliberalism," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 43(C), pages 47-64.
    5. Rogelio Madrueño & Magdalene Silberberger, 2022. "Dimensions and Cartography of Dirty Money in Developing Countries: Tripping Up on the Global Hydra," Politics and Governance, Cogitatio Press, vol. 10(2), pages 25-39.
    6. Gentilucci, Eleonora, 2020. "A causality analysis. Military expenditures and economic growth in USA and China," MPRA Paper 104848, University Library of Munich, Germany.
    7. Sebastian Felten, 2015. "Accounting evolution to 1400: how to explain the emergence of new accounting techniques?," Accounting History Review, Taylor & Francis Journals, vol. 25(2), pages 167-171, July.
    8. J. Drake, 2022. "Pistor’s Code of Capital: Wealth Inequality and Legalism About Capital," Journal of Business Ethics, Springer, vol. 181(3), pages 583-588, December.
    9. Matilal, Sumohon & Adhikari, Pawan, 2020. "Accounting in Bhopal: Making catastrophe," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 72(C).
    10. Mathis L Richtmann & Lea Steininger, 2023. "From bazooka to backstop: the political economy of standing swap facilities," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 47(4), pages 681-702.
    11. Aresu, Simone & Monfardini, Patrizio, 2023. "Oppressed by consumerism: The emancipatory role of household accounting," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 96(C).
    12. Richard, Jacques, 2015. "The dangerous dynamics of modern capitalism (from static to IFRS’ futuristic accounting)," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 30(C), pages 9-34.
    13. Lagoarde-Segot, Thomas, 2017. "Financialization: Towards a new research agenda," International Review of Financial Analysis, Elsevier, vol. 51(C), pages 113-123.
    14. Nhu Tuyên Le, 2009. "Liens Entre Comptabilite Et Systeme Economique : La Transition Vietnamienne," Grenoble Ecole de Management (Post-Print) halshs-00460227, HAL.
    15. Yannick Lemarchand & Laure Pineau-Defois & Cheryl Mcwatters, 2011. "Comptes et récits de la maison Chaurand, retour sur les liens entre comptabilité et capitalisme," Post-Print hal-00650546, HAL.
    16. Macve, R.H., 2015. "Fair value vs conservatism? Aspects of the history of accounting, auditing, business and finance from ancient Mesopotamia to modern China," The British Accounting Review, Elsevier, vol. 47(2), pages 124-141.
    17. Haynes, Kathryn, 2017. "Accounting as gendering and gendered: A review of 25 years of critical accounting research on gender," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 43(C), pages 110-124.
    18. Kracman, Kimberly, 2022. "Code as constitution: The negotiation of a uniform accounting code for U.S. railway corporations and the moral justification of stakeholder claims on wealth," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 89(C).
    19. Vargha, Zsuzsanna, 2016. "Note from the editor: The results of accounting," economic sociology. perspectives and conversations, Max Planck Institute for the Study of Societies, vol. 17(2), pages 2-6.
    20. Nhu Tuyên Le, 2009. "Liens Entre Comptabilite Et Systeme Economique : La Transition Vietnamienne," Post-Print halshs-00460227, HAL.

    More about this item

    Keywords

    capitalism; inequality; legal codes; rent-seeking;
    All these keywords.

    JEL classification:

    • P16 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Institutions; Welfare State
    • K10 - Law and Economics - - Basic Areas of Law - - - General (Constitutional Law)

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:aelcon:v:11:y:2021:i:1:p:53-64:n:2. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.