IDEAS home Printed from https://ideas.repec.org//p/sap/wpaper/wp209.html
   My bibliography  Save this paper

Monopoly Capitalism in the Digital Era

Author

Listed:
  • Andrea Coveri
  • Claudio Cozza
  • Dario Guarascio

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 unique centre of strategic decision-making, we attempt to develop a framework where digital platforms are conceived as an evolution of large transnational corporations. Power and control in our Monopoly Capitalism view are then meant 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 Amazon dominates other firms and suppliers through its diversification and a direct control of data and technology; its power is also linked to global labour fragmentation and uneven bargaining power vis-Ã -vis world governments, as in the Hymer and Cowling's tradition.

Suggested Citation

  • Andrea Coveri & Claudio Cozza & Dario Guarascio, 2021. "Monopoly Capitalism in the Digital Era," Working Papers in Public Economics 209, University of Rome La Sapienza, Department of Economics and Law.
    • Handle: RePEc:sap:wpaper:wp209
    as

    Download full text from publisher

    File URL: https://web.uniroma1.it/dip_ecodir/sites/default/files/wpapers/wp209.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Cédric Durand & Wiliiam Milberg, 2020. "Intellectual monopoly in global value chains," Review of International Political Economy, Taylor & Francis Journals, vol. 27(2), pages 404-429, March.
    2. Varian,Hal R. & Farrell,Joseph & Shapiro,Carl, 2004. "The Economics of Information Technology," Cambridge Books, Cambridge University Press, number 9780521844154, January.
    3. Stefano Ponte & Timothy J. Sturgeon & Mark P. Dallas, 2019. "Governance and power in global value chains," Chapters, in: Stefano Ponte & Gary Gereffi & Gale Raj-Reichert (ed.), Handbook on Global Value Chains, chapter 6, pages 120-137, Edward Elgar Publishing.
    4. Jean‐Charles Rochet & Jean Tirole, 2006. "Two‐sided markets: a progress report," RAND Journal of Economics, RAND Corporation, vol. 37(3), pages 645-667, September.
    5. Hymer, Stephen, 1970. "The Efficiency (Contradictions) of Multinational Corporations," American Economic Review, American Economic Association, vol. 60(2), pages 441-448, May.
    6. Cecilia Rikap, 2018. "Innovation as economic power in Global Value Chains," Revue d'économie industrielle, De Boeck Université, vol. 0(3), pages 35-75.
    7. Paola Tubaro & Antonio A. Casilli & Marion Coville, 2020. "The trainer, the verifier, the imitator: Three ways in which human platform workers support artificial intelligence," Post-Print hal-02554196, HAL.
    8. Ugo Pagano & Maria Alessandra Rossi, 2009. "The crash of the knowledge economy," Cambridge Journal of Economics, Oxford University Press, vol. 33(4), pages 665-683, July.
    9. Giovanni Balcet & Grazia Ietto-Gillies, 2020. "Internationalisation, outsourcing and labour fragmentation: the case of FIAT," Cambridge Journal of Economics, Oxford University Press, vol. 44(1), pages 105-128.
    10. Feng Zhu & Qihong Liu, 2018. "Competing with complementors: An empirical look at Amazon.com," Strategic Management Journal, Wiley Blackwell, vol. 39(10), pages 2618-2642, October.
    11. Matthieu Montalban & Vincent Frigant & Bernard Jullien, 2019. "Platform economy as a new form of capitalism: a Régulationist research programme," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 43(4), pages 805-824.
    12. Maryann Feldman & Frederick Guy & Simona Iammarino, 2021. "Regional income disparities, monopoly and finance," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 14(1), pages 25-49.
    13. Lucrezia Fanti & Dario Guarascio & Massimo Moggi, 2020. "The development of AI and its impact on business models, organization and work," LEM Papers Series 2020/25, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    14. Buckley, Peter J., 2006. "Stephen Hymer: Three phases, one approach?," International Business Review, Elsevier, vol. 15(2), pages 140-147, April.
    15. Martin Kenney & John Zysman, 2020. "The platform economy: restructuring the space of capitalist accumulation," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 13(1), pages 55-76.
    16. Mark P. Dallas & Stefano Ponte & Timothy J. Sturgeon, 2019. "Power in global value chains," Review of International Political Economy, Taylor & Francis Journals, vol. 26(4), pages 666-694, July.
    17. Jean-Charles Rochet & Jean Tirole, 2003. "Platform Competition in Two-Sided Markets," Journal of the European Economic Association, MIT Press, vol. 1(4), pages 990-1029, June.
    18. Xuelin Li & Andrew W. Lo & Richard T. Thakor, 2021. "Paying off the Competition: Contracting, Market Power, and Innovation Incentives," NBER Working Papers 28964, National Bureau of Economic Research, Inc.
    19. Edward M. Graham, 2002. "The Contributions of Stephen Hymer: One View," Contributions to Political Economy, Oxford University Press, vol. 21(1), pages 27-41, December.
    20. Ugo Pagano, 2014. "The crisis of intellectual monopoly capitalism," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 38(6), pages 1409-1429.
    21. Christos N. Pitelis, 2002. "Stephen Hymer: Life and the Political Economy of Multinational Corporate Capital," Contributions to Political Economy, Oxford University Press, vol. 21(1), pages 9-26, December.
    22. John H Dunning & Christos N Pitelis, 2008. "Stephen Hymer's contribution to international business scholarship: an assessment and extension," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 39(1), pages 167-176, January.
    23. Roger Strange & John Humphrey, 2019. "What lies between market and hierarchy? Insights from internalization theory and global value chain theory," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(8), pages 1401-1413, October.
    24. Unknown, 2005. "Forward," 2005 Conference: Slovenia in the EU - Challenges for Agriculture, Food Science and Rural Affairs, November 10-11, 2005, Moravske Toplice, Slovenia 183804, Slovenian Association of Agricultural Economists (DAES).
    25. Strange, Roger & Newton, James, 2006. "Stephen Hymer and the externalization of production," International Business Review, Elsevier, vol. 15(2), pages 180-193, April.
    26. Keith Cowling & Philip R. Tomlinson, 2005. "Globalisation And Corporate Power," Contributions to Political Economy, Oxford University Press, vol. 24(1), pages 33-54, August.
    27. Keith Cowling & Philip R. Tomlinson, 2011. "Post the 'Washington Consensus': economic governance and industrial strategies for the twenty-first century," Cambridge Journal of Economics, Oxford University Press, vol. 35(5), pages 831-852.
    28. Justus Haucap & Ulrich Heimeshoff, 2014. "Google, Facebook, Amazon, eBay: Is the Internet driving competition or market monopolization?," International Economics and Economic Policy, Springer, vol. 11(1), pages 49-61, February.
    29. Calvano, Emilio & Polo, Michele, 2021. "Market power, competition and innovation in digital markets: A survey," Information Economics and Policy, Elsevier, vol. 54(C).
    30. Cowling, Keith & Sugden, Roger, 1998. "The Essence of the Modern Corporation: Markets, Strategic Decision-Making and the Theory of the Firm," The Manchester School of Economic & Social Studies, University of Manchester, vol. 66(1), pages 59-86, January.
    31. K. Sabeel Rahman & Kathleen Thelen, 2019. "The Rise of the Platform Business Model and the Transformation of Twenty-First-Century Capitalism," Politics & Society, , vol. 47(2), pages 177-204, June.
    32. J. Robert Branston & Keith Cowling & Roger Sugden, 2006. "Corporate Governance and the Public Interest," International Review of Applied Economics, Taylor & Francis Journals, vol. 20(2), pages 189-212.
    33. Maryann Feldman & Frederick Guy & Simona Iammarino, 2019. "Regional income disparities, monopoly & finance," Working Papers 43, Birkbeck Centre for Innovation Management Research, revised Feb 2021.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jean-Philippe Deranty & Thomas Corbin, 2022. "Artificial Intelligence and work: a critical review of recent research from the social sciences," Papers 2204.00419, arXiv.org.
    2. Lucrezia Fanti & Dario Guarascio & Massimo Moggi, 2022. "From Heron of Alexandria to Amazon’s Alexa: a stylized history of AI and its impact on business models, organization and work," Economia e Politica Industriale: Journal of Industrial and Business Economics, Springer;Associazione Amici di Economia e Politica Industriale, vol. 49(3), pages 409-440, September.

    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. Liena Kano & Eric W. K. Tsang & Henry Wai-chung Yeung, 2020. "Global value chains: A review of the multi-disciplinary literature," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 51(4), pages 577-622, June.
    2. Cédric Durand & Wiliiam Milberg, 2020. "Intellectual monopoly in global value chains," Review of International Political Economy, Taylor & Francis Journals, vol. 27(2), pages 404-429, March.
    3. Steffen, Nico & Wiewiorra, Lukas & Kroon, Peter, 2021. "Wettbewerb und Regulierung in der Plattform- und Datenökonomie," WIK Discussion Papers 481, WIK Wissenschaftliches Institut für Infrastruktur und Kommunikationsdienste GmbH.
    4. Christos N. Pitelis, 2011. "Foreign Direct Investment and Economic Integration," Chapters, in: Miroslav N. Jovanović (ed.), International Handbook on the Economics of Integration, Volume III, chapter 1, Edward Elgar Publishing.
    5. Pease, Stephanie & Paliwoda, Stanley & Slater, Jim, 2006. "The erosion of stable shareholder practice in Japan ("Anteikabunushi Kosaku")," International Business Review, Elsevier, vol. 15(6), pages 618-640, December.
    6. Coveri, Andrea & Cozza, Claudio & Guarascio, Dario, 2023. "Blurring boundaries: an analysis of the digital platforms-military nexus," GLO Discussion Paper Series 1364, Global Labor Organization (GLO).
    7. Strange, Roger & Newton, James, 2006. "Stephen Hymer and the externalization of production," International Business Review, Elsevier, vol. 15(2), pages 180-193, April.
    8. Ugo Pagano, 2019. "Proprietà e controllo delle grandi imprese: un’interpretazione del resistibile declino italiano," Department of Economics University of Siena 798, Department of Economics, University of Siena.
    9. Oliver Budzinski & Annika Stöhr, 2019. "Competition policy reform in Europe and Germany – institutional change in the light of digitization," European Competition Journal, Taylor & Francis Journals, vol. 15(1), pages 15-54, January.
    10. Prado, Tiago S., 2022. "Safeguarding Competition in Digital Markets: A Comparative Analysis of Emerging Policy and Regulatory Regimes," 31st European Regional ITS Conference, Gothenburg 2022: Reining in Digital Platforms? Challenging monopolies, promoting competition and developing regulatory regimes 265666, International Telecommunications Society (ITS).
    11. Silvia Sacchetti, 2015. "Inclusive and Exclusive Social Preferences: A Deweyan Framework to Explain Governance Heterogeneity," Journal of Business Ethics, Springer, vol. 126(3), pages 473-485, February.
    12. Pham, Hanh Song Thi & Petersen, Bent, 2021. "The bargaining power, value capture, and export performance of Vietnamese manufacturers in global value chains," International Business Review, Elsevier, vol. 30(6).
    13. Budzinski, Oliver, 2016. "Aktuelle Herausforderungen der Wettbewerbspolitik durch Marktplätze im Internet," Ilmenau Economics Discussion Papers 103, Ilmenau University of Technology, Institute of Economics.
    14. Szepesi, Balázs, 2021. "A gyümölcstermesztő és az ipari beszállító vállalkozások piaci pozíciója. Egy kvalitatív kutatás eredményei [Empirical insights on the factors shaping the market position of fruit producers and ind," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(S11), pages 52-77.
    15. Argentesi, Elena & Buccirossi, Paolo & Calvano, Emilio & Duso, Tomaso & Marrazzo, Alessia & Nava, Salvatore, 2021. "Merger Policy in Digital Markets: An Ex Post Assessment," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 17(1), pages 95-140.
    16. Saul Estrin & Susanna Khavul & Mike Wright, 2022. "Soft and hard information in equity crowdfunding: network effects in the digitalization of entrepreneurial finance," Small Business Economics, Springer, vol. 58(4), pages 1761-1781, April.
    17. Tristan Auvray & Cédric Durand & Joel Rabinovich & Cecilia Rikap, 2021. "Corporate financialization’s conservation and transformation: from Mark I to Mark II," Review of Evolutionary Political Economy, Springer, vol. 2(3), pages 431-457, December.
    18. Jullien, Bruno & Pavan, Alessandro & Rysman, Marc, 2021. "Two-sided Markets, Pricing, and Network Effects," TSE Working Papers 21-1238, Toulouse School of Economics (TSE).
    19. Justus Haucap & Torben Stühmeier, 2016. "Competition and antitrust in Internet markets," Chapters, in: Johannes M. Bauer & Michael Latzer (ed.), Handbook on the Economics of the Internet, chapter 9, pages 183-210, Edward Elgar Publishing.
    20. Inoue, Yuki, 2021. "Indirect innovation management by platform ecosystem governance and positioning: Toward collective ambidexterity in the ecosystems," Technological Forecasting and Social Change, Elsevier, vol. 166(C).

    More about this item

    Keywords

    Monopoly Capital; Monopoly Power; Digital Platforms; Amazon; Multinational corporation;
    All these keywords.

    JEL classification:

    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • P12 - Political Economy and Comparative Economic Systems - - Capitalist Economies - - - Capitalist Enterprises

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:sap:wpaper:wp209. 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: Luisa Giuriato (email available below). General contact details of provider: https://edirc.repec.org/data/dprosit.html .

    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.