Corporate Power and the Expansion of Economic Inequality in the U.S., 1975-2025

• In Event: Political Sociology Section Roundtables
  In Refereed Roundtable (60 minute): Political Institutions (Table 20)

Abstract

Prior research shows that the relative power of labor organizations and political parties shape levels of economic inequality by influencing key distributional policies and institutions. Yet, this literature has given comparatively little attention to the power of business. This represents a critical omission—in many countries such as the United States. business is deeply embedded within political institutions, and its power is distinct from that of both labor and parties. The present study addresses this by quantitatively examining the relationship between business power and income inequality in the US. In doing so, we offer three specific sets of research contributions. First, this study analyzes multiple sources and dimensions of power, including those related to both “structural” and “instrumental” power. Second, this research parses out the influence of the business class more broadly from that of specific sectors and industries. Existing research points to the particular importance of the financial sector and banking industry in the years prior to the 2008 financial crisis, but critical developments since suggest new configurations of corporate power underlying inequality. Third, this paper explores how the structure of power relations among businesses impacts levels of income inequality. It specifically focuses on the concentration and cohesion of corporate power. To study this, we construct a novel dataset of US states between 1975 and 2025. Descriptively, we chart how the power of the broad business class, key sectors (e.g., finance and technology), and industries within them has changed throughout the last five centuries. For each of these groups, we consider both potential sources of power and the mobilization of these power resources. Top income shares are then regressed on measures of business power and corporate structure, shedding light on the actors, sources, and structures of corporate power that are particularly consequential for levels of economic inequality.

Author

• Robert R Murphy, CUNY-Graduate Center