Collective capitalism

Collective Capitalist Theory

Collective capitalism places an emphasis on cooperative long-term relationships, resulting in an economy directed by "relational markets". An example of this is interlocking share ownership, in which many companies own shares in other companies; this results in a spirit of cooperation between the involved companies, since each has an interest in the other's performance. An important example of this is the Japanese economy, in which 40% of the shares traded on the Tokyo Stock Exchange are owned by the collection of industrial groups known as the kigyo shudan, and a further 30% are owned by the network of cross-shareholdings known as the keiretsu. This results in a stability of ownership, since the potential for hostile takeovers is lessened, and also "friendly" competition; companies are encouraged to excel but for the benefit of others as well as themselves.

History

See also: Post-Occupation Japan, Economy of Japan

Collective capitalism stemmed from the economic and social restructuring of Japan following World War Two. This programme of industrial development proved spectacularly successful, and Japan experienced tremendous growth; this led to Japan permanently adopting the collective capitalist ideal. Japan currently has the world's third largest economy by purchasing power parity (PPP) and the second largest by market exchange rates.

Collective capitalism's influence can be seen in modern Japan. Workers - particularly those who work for large businesses - become involved in their firms in ways unlike those that happen in other capitalist systems such as the United States. In return for loyalty and hard work, workers traditionally expect much more from their employers than their western counterparts, including job security - often for life - pensions and social protection. This system of collective cooperation and the domination of the worker in corporate policy has led to the Japanese system being dubbed "peoplism" by some critics.

Criticisms

Many critics have voiced concerns that, whilst collective capitalism often provides superior benefits for workers, it also places high demand on them and their families. Long hours and high levels of discipline are commonplace, resulting in high levels of stress and the emergence of karoshi or "death by overwork" among the Japanese workforce.

See also

• East Asian model
• Corporate capitalism
• Capitalism