Abstract We examine how government venture capital (GVC)—a specific type of political connection—affected initial public offering (IPO) valuation. Contrary to the well-recognized benefits of political connections in channeling access to financial resources in China, our analysis of 959 IPOs between 2008 and 2014 suggests that GVC backing lowers IPO valuation. This baseline effect is moderated by other sources of political connection (e.g. government ownership, state sector experience of top management team members, private sector partner status, and institutional environments). We argue that it is the negative signaling mechanism revolving around political connections that accounts for this observable pattern. This research enriches the signaling theory by uncovering signal emergence and analyzing the interactions between several signaling sources of political connection. Specifically, it contributes to a better understanding of political connections by specifying an undesirable consequence of state-led financialization, which has timely practical relevance as China’s capital market is steering toward a rule-based system.
{"title":"Revolving around political connections: the negative effect of government venture capital backing on IPO valuation","authors":"Tan Li, Jar-Der Luo, Enying Zheng","doi":"10.1093/ser/mwad056","DOIUrl":"https://doi.org/10.1093/ser/mwad056","url":null,"abstract":"Abstract We examine how government venture capital (GVC)—a specific type of political connection—affected initial public offering (IPO) valuation. Contrary to the well-recognized benefits of political connections in channeling access to financial resources in China, our analysis of 959 IPOs between 2008 and 2014 suggests that GVC backing lowers IPO valuation. This baseline effect is moderated by other sources of political connection (e.g. government ownership, state sector experience of top management team members, private sector partner status, and institutional environments). We argue that it is the negative signaling mechanism revolving around political connections that accounts for this observable pattern. This research enriches the signaling theory by uncovering signal emergence and analyzing the interactions between several signaling sources of political connection. Specifically, it contributes to a better understanding of political connections by specifying an undesirable consequence of state-led financialization, which has timely practical relevance as China’s capital market is steering toward a rule-based system.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-10-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135803786","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Platform cooperatives that are owned and governed by gig workers themselves have been proposed as a silver bullet to improve these workers’ influence on organizational decision-making. However, they remain relatively rare compared with dominant investor-owned platforms. Traditionally, worker cooperatives strive for alternative organizing based on the ideal of workplace democracy but are often faced with unequal participation by members in decision-making processes. To test for participation inequalities, this study used survey data (n = 418) from a network of four platform worker cooperatives in Italy. The results show that members with lower affective commitment towards their cooperative and less social capital among other members are less likely to participate, but that there is no effect of cooperative size and human capital.
{"title":"Silicon law of oligarchy: patterns of member participation in the decision-making of platform cooperatives","authors":"Damion J Bunders","doi":"10.1093/ser/mwad058","DOIUrl":"https://doi.org/10.1093/ser/mwad058","url":null,"abstract":"Platform cooperatives that are owned and governed by gig workers themselves have been proposed as a silver bullet to improve these workers’ influence on organizational decision-making. However, they remain relatively rare compared with dominant investor-owned platforms. Traditionally, worker cooperatives strive for alternative organizing based on the ideal of workplace democracy but are often faced with unequal participation by members in decision-making processes. To test for participation inequalities, this study used survey data (n = 418) from a network of four platform worker cooperatives in Italy. The results show that members with lower affective commitment towards their cooperative and less social capital among other members are less likely to participate, but that there is no effect of cooperative size and human capital.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-10-08","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135198251","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Abstract Income comparisons imply that individuals care not only about the absolute value of their income but also about its relative value. Such comparisons likely have significant societal consequences while also challenging standard neoclassical economic theory. I argue that a better understanding of income comparisons requires a more systematic, theoretical engagement with three problems: (1) the problem of reference group selection, (2) the problem of orientation, and (3) the problem of functional form. Income comparisons are commonly attributed to interdependent preferences, in particular to envy. I propose an alternative theoretical approach in which comparisons are a rational means for individuals to improve upon imperfect information about their current earning potential. I test the empirical implications of both approaches for reference group selection, orientation, and functional form using individual-level data from the Netherlands. The evidence suggests that imperfect information drives comparisons, but interdependent preferences also play a role.
{"title":"Looking up and down and round and round: a theoretical–empirical, individual-level analysis of income comparisons","authors":"Alex Lehr","doi":"10.1093/ser/mwad054","DOIUrl":"https://doi.org/10.1093/ser/mwad054","url":null,"abstract":"Abstract Income comparisons imply that individuals care not only about the absolute value of their income but also about its relative value. Such comparisons likely have significant societal consequences while also challenging standard neoclassical economic theory. I argue that a better understanding of income comparisons requires a more systematic, theoretical engagement with three problems: (1) the problem of reference group selection, (2) the problem of orientation, and (3) the problem of functional form. Income comparisons are commonly attributed to interdependent preferences, in particular to envy. I propose an alternative theoretical approach in which comparisons are a rational means for individuals to improve upon imperfect information about their current earning potential. I test the empirical implications of both approaches for reference group selection, orientation, and functional form using individual-level data from the Netherlands. The evidence suggests that imperfect information drives comparisons, but interdependent preferences also play a role.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-10-04","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135549269","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Much of the gender pay gap is generated within workplaces, making it paramount to understand which workplace policies effectively address gaps. Our article asks when policies limit gender pay gaps across employee tenure to identify potential temporal weak points. We analyze a representative panel of 10,000 establishments with over 850,000 employees using the 2005–19 waves of German-linked employer–employee data (LIAB). Two key findings emerge. First, a temporal perspective on workplace policies reveals that no policy under study—formalization, identity-based career programs, and child care assistance—reduces gender pay gaps at hire. Instead, policies only address additional disparities that accumulate after hire. Second, only identity-based career programs narrow gender disparities for all women. In contrast, seemingly gender-neutral formalization is insufficient, while providing employer-sponsored child care has mixed effects depending on employees’ education. We conclude by discussing the implications of these findings for organizational policy and future research.
{"title":"Off to a slow start: which workplace policies can limit gender pay gaps across firm tenure?","authors":"Anne-Kathrin Kronberg, Anna Gerlach","doi":"10.1093/ser/mwad055","DOIUrl":"https://doi.org/10.1093/ser/mwad055","url":null,"abstract":"Much of the gender pay gap is generated within workplaces, making it paramount to understand which workplace policies effectively address gaps. Our article asks when policies limit gender pay gaps across employee tenure to identify potential temporal weak points. We analyze a representative panel of 10,000 establishments with over 850,000 employees using the 2005–19 waves of German-linked employer–employee data (LIAB). Two key findings emerge. First, a temporal perspective on workplace policies reveals that no policy under study—formalization, identity-based career programs, and child care assistance—reduces gender pay gaps at hire. Instead, policies only address additional disparities that accumulate after hire. Second, only identity-based career programs narrow gender disparities for all women. In contrast, seemingly gender-neutral formalization is insufficient, while providing employer-sponsored child care has mixed effects depending on employees’ education. We conclude by discussing the implications of these findings for organizational policy and future research.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-10-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135739886","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article explores two questions. What generates the political division over climate change policy in the United States? How is the division over climate change policy related to the broader polarization of contemporary American politics? I argue that the geographies of America’s dual economy—the knowledge economy and the carbon economy—and exposure to the climate crisis intersect to generate a new axis of conflict, which I call the carbon–climate cleavage. This cleavage produces political division over climate change and provides materialist elements that accompany the sociocultural factors that shape contemporary polarization. I demonstrate the existence of the cleavage and its impact using data on economic geography, political attitudes on climate change policy, and support for Trump in the 2016 and 2020 presidential elections. The empirical analysis indicates that carbon economy communities oppose climate change policy and support Trump, while knowledge economy residents support climate change policy and oppose Trump.
{"title":"The dual economy, climate change, and the polarization of American politics","authors":"Thomas Oatley","doi":"10.1093/ser/mwad052","DOIUrl":"https://doi.org/10.1093/ser/mwad052","url":null,"abstract":"This article explores two questions. What generates the political division over climate change policy in the United States? How is the division over climate change policy related to the broader polarization of contemporary American politics? I argue that the geographies of America’s dual economy—the knowledge economy and the carbon economy—and exposure to the climate crisis intersect to generate a new axis of conflict, which I call the carbon–climate cleavage. This cleavage produces political division over climate change and provides materialist elements that accompany the sociocultural factors that shape contemporary polarization. I demonstrate the existence of the cleavage and its impact using data on economic geography, political attitudes on climate change policy, and support for Trump in the 2016 and 2020 presidential elections. The empirical analysis indicates that carbon economy communities oppose climate change policy and support Trump, while knowledge economy residents support climate change policy and oppose Trump.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-10-03","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135739889","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Why do firms take excessive risks that result in failure? Moral hazard theorists argue that the answer lies in the risk-boosting effects of the government safety net, which insulates firms from market discipline. We revisit this conventional wisdom by examining how exposure to government protection has contributed to recent trends in bank risk-taking in the USA. Drawing from insights from economic sociology, we highlight an additional way that exposure to government protection can shape organizational behavior: by reducing resource-based profitability pressures that can spur risky behavior. Using panel data analysis of risky US bank behavior between 1994 and 2015, we find that bank exposure to government protection was more often associated with less risk-taking than more of it. This pattern contradicts the predictions of moral hazard theory but aligns with the predictions of our own institutional-resource theory. We discuss implications for economic sociology and financial economics.
{"title":"Rethinking moral hazard: government protection and bank risk-taking","authors":"Kim Pernell, Jiwook Jung","doi":"10.1093/ser/mwad050","DOIUrl":"https://doi.org/10.1093/ser/mwad050","url":null,"abstract":"Why do firms take excessive risks that result in failure? Moral hazard theorists argue that the answer lies in the risk-boosting effects of the government safety net, which insulates firms from market discipline. We revisit this conventional wisdom by examining how exposure to government protection has contributed to recent trends in bank risk-taking in the USA. Drawing from insights from economic sociology, we highlight an additional way that exposure to government protection can shape organizational behavior: by reducing resource-based profitability pressures that can spur risky behavior. Using panel data analysis of risky US bank behavior between 1994 and 2015, we find that bank exposure to government protection was more often associated with less risk-taking than more of it. This pattern contradicts the predictions of moral hazard theory but aligns with the predictions of our own institutional-resource theory. We discuss implications for economic sociology and financial economics.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-09-21","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136235985","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
This article explores private art museums’ role for elite legitimization processes. Based on interviews with founders, directors, and curators of Germany-based private museums, I explore the discourses participants invoke to legitimize museum founders as actors in the artworld and as elites generally. I draw out a two-pronged legitimation strategy. First, respondents posit private museums’ increasingly important role for today’s art ecosystem, implying logics of discursive innovation and organizational flexibility vis-à-vis public museums. Second, interviewees construct intra-group status hierarchies via notions of the autonomous and ethical collector-founder versus other ostentatious private collectors and unethical wealth elites more widely. Together, these narratives effectively conflate seemingly opposite discourses of private entrepreneurialism and authenticity, allowing interviewees to signal legitimacy for founders over both public and other private actors. This elite legitimation work is performed by both founders and those institutionally connected to them, showing how legitimization can be a complex and institutionally mediated process.
{"title":"The art of (self)legitimization: how private museums help their founders claim legitimacy as elite actors","authors":"Kristina Kolbe","doi":"10.1093/ser/mwad051","DOIUrl":"https://doi.org/10.1093/ser/mwad051","url":null,"abstract":"This article explores private art museums’ role for elite legitimization processes. Based on interviews with founders, directors, and curators of Germany-based private museums, I explore the discourses participants invoke to legitimize museum founders as actors in the artworld and as elites generally. I draw out a two-pronged legitimation strategy. First, respondents posit private museums’ increasingly important role for today’s art ecosystem, implying logics of discursive innovation and organizational flexibility vis-à-vis public museums. Second, interviewees construct intra-group status hierarchies via notions of the autonomous and ethical collector-founder versus other ostentatious private collectors and unethical wealth elites more widely. Together, these narratives effectively conflate seemingly opposite discourses of private entrepreneurialism and authenticity, allowing interviewees to signal legitimacy for founders over both public and other private actors. This elite legitimation work is performed by both founders and those institutionally connected to them, showing how legitimization can be a complex and institutionally mediated process.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-09-10","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"136072656","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
The type of work we do as adults is significantly influenced by our parents’ social class. However, digital technologies are transforming the way labour markets work. Candidates are screened using algorithmic decision-making systems. Skills are validated with online tests and feedback ratings. Communications take place online. Could these transformations undermine the advantages that have accrued to workers with privileged backgrounds or reproduce this privilege through digital divides? We examine this question with survey evidence from the online (remote) platform economy, a labour market segment where these digital transformations have progressed furthest (N = 1,001). The results reveal that online platform workers come predominantly from privileged class backgrounds, but we find less evidence of parental class shaping what types of online work they do. We conclude that digital transformations of labour markets may reproduce disparities in access to work but attenuate some class-based differences in the selection of workers by employers.
{"title":"Labour market digitalization and social class: evidence of mobility and reproduction from a European survey of online platform workers","authors":"Nicholas Martindale, V. Lehdonvirta","doi":"10.1093/ser/mwad049","DOIUrl":"https://doi.org/10.1093/ser/mwad049","url":null,"abstract":"\u0000 The type of work we do as adults is significantly influenced by our parents’ social class. However, digital technologies are transforming the way labour markets work. Candidates are screened using algorithmic decision-making systems. Skills are validated with online tests and feedback ratings. Communications take place online. Could these transformations undermine the advantages that have accrued to workers with privileged backgrounds or reproduce this privilege through digital divides? We examine this question with survey evidence from the online (remote) platform economy, a labour market segment where these digital transformations have progressed furthest (N = 1,001). The results reveal that online platform workers come predominantly from privileged class backgrounds, but we find less evidence of parental class shaping what types of online work they do. We conclude that digital transformations of labour markets may reproduce disparities in access to work but attenuate some class-based differences in the selection of workers by employers.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":3.7,"publicationDate":"2023-09-06","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"47765750","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Abstract This article offers a comparative-historical perspective on the moral economy of land. We reconstruct the moral economy of the popular land reform movement that opposed the illegitimate income streams of rentiers and speculators in the early 20th century, tracing the movement’s legacy through a long-run analysis of political party platforms since 1880 in the USA, the UK, Germany and Sweden. We find that the land reformers’ conceptualization of land as a moral good was a key topic in early 20th-century party politics. Parties across the political spectrum called for wide-ranging interventions in unregulated land markets. But despite the movement’s relative success, the new ideal of the ownership society soon gained ground as an alternative to the more radical politics of land decommodification. We find growing multipartisan support for small property owners over time, culminating in the rise of a new moral conceptualization of land as capital. With the recent comeback of the land question, both rural and urban, we conclude that an understanding of historical land reform debates should inform future research toward a much-needed sociology of land.
{"title":"The moral economy of land: from land reform to ownership society, 1880–2018","authors":"Alexander Dobeson, Sebastian Kohl","doi":"10.1093/ser/mwad048","DOIUrl":"https://doi.org/10.1093/ser/mwad048","url":null,"abstract":"Abstract This article offers a comparative-historical perspective on the moral economy of land. We reconstruct the moral economy of the popular land reform movement that opposed the illegitimate income streams of rentiers and speculators in the early 20th century, tracing the movement’s legacy through a long-run analysis of political party platforms since 1880 in the USA, the UK, Germany and Sweden. We find that the land reformers’ conceptualization of land as a moral good was a key topic in early 20th-century party politics. Parties across the political spectrum called for wide-ranging interventions in unregulated land markets. But despite the movement’s relative success, the new ideal of the ownership society soon gained ground as an alternative to the more radical politics of land decommodification. We find growing multipartisan support for small property owners over time, culminating in the rise of a new moral conceptualization of land as capital. With the recent comeback of the land question, both rural and urban, we conclude that an understanding of historical land reform debates should inform future research toward a much-needed sociology of land.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-08-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135715765","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Abstract This article uses data from a natural experiment to address one of the most contentious issues in the on-demand platform economy—whether gig work is compatible with standard employment. We analyze a US-based package delivery platform that shifted a subset of its workers from independent contractors to employees, thereby creating a natural experiment that allowed us to exploit variation over time and across locations. We examine the impact of employment status on work scheduling practices, hours of work and the firm’s ability to match workers’ scheduled hours with the amount of time they were actively engaged in parcel delivery. We find that after the transition to employment, flexibility with respect to how work schedules were determined was maintained, and drivers’ total hours of work increased. We also find that the switch to employee status increased the firm’s ability to match scheduled and actual working time, indicating greater operational efficiency. We conclude, contrary to claims commonly made by platform firms, that employment status can coexist with the platform model.
{"title":"Employment status and the on-demand economy: a natural experiment on reclassification","authors":"Hannah Johnston, Ozlem Ergun, Juliet Schor, Lidong Chen","doi":"10.1093/ser/mwad047","DOIUrl":"https://doi.org/10.1093/ser/mwad047","url":null,"abstract":"Abstract This article uses data from a natural experiment to address one of the most contentious issues in the on-demand platform economy—whether gig work is compatible with standard employment. We analyze a US-based package delivery platform that shifted a subset of its workers from independent contractors to employees, thereby creating a natural experiment that allowed us to exploit variation over time and across locations. We examine the impact of employment status on work scheduling practices, hours of work and the firm’s ability to match workers’ scheduled hours with the amount of time they were actively engaged in parcel delivery. We find that after the transition to employment, flexibility with respect to how work schedules were determined was maintained, and drivers’ total hours of work increased. We also find that the switch to employee status increased the firm’s ability to match scheduled and actual working time, indicating greater operational efficiency. We conclude, contrary to claims commonly made by platform firms, that employment status can coexist with the platform model.","PeriodicalId":47947,"journal":{"name":"Socio-Economic Review","volume":null,"pages":null},"PeriodicalIF":0.0,"publicationDate":"2023-08-22","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"135621388","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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