Stakeholder protection in corporate governance and in the legal system, the varieties of capitalism, and long term unemployment
AbstractIn the literature the issue of the protection of stakeholder interests (of employees in particular) is usually considered in a static context: how should the institutions of corporate governance be shaped having regard to already existing firms, conforming in particular to some subjective criteria of fairness and fair play. It is remarkable that no attention is usually paid to the basic fact that a company in order to exist must first be established, and that the founders-owners are the original shareholders. Moreover not necessarily the most appropriate protection of stakeholder interests can be provided by the institutions and practice of corporate governance, other specific kinds of legal provisions may be more suitable. But rather than substitution complementarity prevails between different legal provisions protecting the interests of stakeholders (in particular employees) and the stakeholder protection afforded through the institutions of capital governance, conforming to the logic of the different "varieties of capitalism". An aspect that is emphasized in the paper, and is usually overlooked, are the much higher rates of long-term unemployment associated with the continental European variety as compared with the Liberal Market variety of the Anglo-Saxon tradition. But the Scandinavian Social-Democratic market model gives the best of both worlds: low long-term unemployment rate and incidence, together with high degrees of employment protection.
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Bibliographic InfoPaper provided by Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy in its series Discussion Papers with number 2011/126.
Date of creation: 11 Jan 2011
Date of revision:
Corporate Governance; Stakeholders; Long-term Unemployment; Legal Systems; Varieties of Capitalism.;
Find related papers by JEL classification:
- P10 - Economic Systems - - Capitalist Systems - - - General
- P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies
- G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
- K22 - Law and Economics - - Regulation and Business Law - - - Business and Securities Law
- K31 - Law and Economics - - Other Substantive Areas of Law - - - Labor Law
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Allen, Franklin & Carletti, Elena & Marquez, Robert, 2007.
"Stakeholder capitalism, corporate governance and firm value,"
CFS Working Paper Series
2007/26, Center for Financial Studies (CFS).
- Franklin Allen & Elena Carletti & Robert Marquez, 2009. "Stakeholder Capitalism, Corporate Governance and Firm Value," Economics Working Papers ECO2009/10, European University Institute.
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