New institutions for a new economic order
Shareholder-owned corporations were dominant for much of the 20th century, yet their numbers are substantially declining in the 21st. We argue that we are observing a regime shift in the transaction costs of organizing that disfavor traditional corporations. We are also seeing the emergence of low-cost, small-scale production technologies that will allow locally-based universal fabrication facilities. In combination, these changes are compatible with new forms of non-corporate enterprise. Traditional alternatives include producer and consumer cooperatives (e.g., Land o' Lakes, REI) and mutuals (State Farm, Vanguard). More recent possibilities include commons-based peer production (such as Linux and Wikipedia) and “platforms” that connect buyers and sellers (Uber, Airbnb), or sharers. If we want to encourage the creation of jobs and wealth-building for participants, then it is sensible to consider noncorporate alternatives that draw on experiences outside of North America and outside the corporate economy.
Jerry Davis - Wilbur K. Pierpont Collegiate Professor of Management and Professor of Sociology University of Michigan