ENVIRONMENTAL JUSTICE AND THE POLITICAL PROCESS: Movements, Corporations, and the State

I explore two questions in this article: (1) How has the role of the U.S. state in the political process changed vis‐à‐vis corporations? (2) What tactical repertoires have movements devised to confront this changing political process? Through the lens of the U.S. environmental movement, I find that (1) the state's policy‐making authority has weakened as corporations have become both policy makers and the new targets of challengers, (2) the environmental movement has devised organizing strategies–such as corporate‐community compacts or good neighbor agreements–to respond to and influence this new political process, and (3) those segments of the movement that ignore the political economic process are likely to meet with failure. These changes in the political economy constitute a challenge for the political process model. I therefore propose a “political economic process’ perspective to extend the political process model and more accurately capture these dynamics. The political economic process perspective evaluates four state‐centric assumptions of the political process model (the state as the primary movement target or vehicle of reform, the state policy‐making monopoly, capital as just another interest group, and the primacy of the nation‐state level of analysis) and demonstrates that the political economic process has changed in dramatic ways.     

Corporations and the State in the Global Era: The Case of Seaboard Farms and Texas*

Abstract Employing the case of the expansion and regulation of hog confined animal feeding operations (CAFO) in Texas combined with the actions of the transnational agri‐food corporation Seaboard Farms, Inc., this paper probes the relationship between the state and corporations in the global era. It specifically investigates the ability of the state to control agri‐food corporations in a context in which the hyper‐mobility of capital has increasingly allowed corporations to by‐pass state regulations and requirements. Salient literature is reviewed by grouping it into three camps: the first views the state as largely controlled by corporations; the second stresses the powers left to the state and the fact that corporations need state assistance to successfully operate in the current global economy; and the third acknowledges the crisis of the nation‐state under globalization but maintains that the state has retained some ability to resist globalization forces. The case study documents the expansion of Seaboard Farms' hog operations in the Panhandle Region of Texas and nearby states and its interaction with local and state governments and agencies. The article indicates that the relationship between transnational corporations and the state is contradictory. Its source rests on the fracture between varying postures maintained by the state and the relatively homogenous behavior of the CAFO corporations. The case also reveals that the state's limited control of corporate actions is facilitated by state strategies; that corporate actions are successful if corporations enlist the cooperation of the state; and the state is able to control resistance and legitimize its actions to its constituencies. These conditions, however, do not prevent the emergence of anti‐corporate resistance at local and state levels. In the search for new forms of socioeconomic development, local residents and their leaders should be aware of corporations' ability to affect state action, state postures that favor corporate designs, and the fact that successful opposition to corporate designs can be, and is, carried out.     

Market behavior of gaming stocks: An analysis of the first twenty years

Gaming stocks have now been publicly traded on the stock exchange for about twenty years. This study looks at the price movement patterns of gaming stocks compared with the broader market for six stock market cycles between 1973 and 1992. The study suggests that gaming stocks tend to be more volatile than the market as a whole and that this has been true throughout the twenty year period. It also shows that gaming stocks have risen in price during this period at a rate much greater than that for the general market. Special events, such as the establishment of gaming in New Jersey, can cause the gaming stocks to move in a direction opposite to the general market. Finally, the findings indicate that gaming stocks are especially susceptible to stock market declines which are related to concerns about the price or availability of oil.     

The Demand for Healthy Eating: Supporting a Transformative Food “Movement”

To the extent that social science scholarship engages real‐world developments it remains grounded and better able to resist elite agendas. With this in mind this article argues for the critical encounter with what I argue is the most significant struggle around food and agriculture today—the amorphous and broad‐based movement that strives to resist the further degradation of food environments and ensure healthy eating in society. This struggle is inevitably engaged with contemporary neoliberal agendas that have transformed and degraded food environments as they have privileged profit making over healthy diets. The article considers different sites where the struggle over healthy eating is taking place, both at the level of the state and more extensively in civil society. It considers the debate over bovine growth hormone in Canada and the wider efforts to turn around school food environments as examples of state‐centered and civil‐society struggles, respectively, that illustrate different dimensions of the healthy‐eating movement today. In each case the agendas of transnational food corporations are seen to be directly contradicting efforts to ensure healthy diets. The article considers some notable successes among advocates of healthy eating, in the United States and Canada and most notably in Britain, and examines some of the factors that may account for this success. Overall, I argue that this struggle has the potential to challenge the hegemony of neoliberal discourse in fundamental ways. The article concludes with a call for academics, and rural sociologists in particular, to give a much greater priority to healthy‐eating struggles, and considers a number of areas where academic practitioners can aid activists' efforts to resist the further degradation of diets and establish healthier food environments.     

THE TRANSFORMATION AND SURVIVAL OF FORTUNE 500 INDUSTRIAL CORPORATIONS THROUGH MERGERS AND ACQUISITIONS, 1981–1995

The 1980s leveraged buyouts followed by the 1990s stock swap mergers represent the most dynamic period in U.S. business history. Using Cox regression with time-varying covariates, we examine the relationships among changes in corporate mergers and acquisitions, changes in corporate diversification strategies, and the transition from the multidivisional form (MDF) to the multisubsidiary form (MSF) of the largest Fortune 500 U.S. parent corporations. Consistent with the political economy contingency theory of accumulation (PECTA), our findings show that acquisition risk is reduced as a function of size, product and industry diversification, and percentages of shares held by institutional investors. Acquisition risk is increased by holding units in a multidivisional rather than a multisubsidiary form, higher returns to shareholders, higher divestitures, higher production to administrative imensity, and surviving previous takeover attempts. The political-legal institutions of the state have increasingly engaged in activities that are supportive and profitable for industrial and financial corporations. The actions of the state are increasingly aligned with the interests of capital.     

Roles of Stock Price and Exchange Rate in Slovakia's Money Demand Function and Policy Implications

The demand for real M1 in Slovakia is positively influenced by real output and the stock price and negatively associated with the deposit rate, depreciation of the koruna, the euro interest rate, and the expected inflation rate. Considering the goods and the money market simultaneously, these results suggest that a higher stock price may or may not cause real output to rise and that a depreciation of the koruna or a higher euro interest rate would help raise Slovakia's real output. The coefficients of the deposit rate and the stock price in real M2 demand are insignificant at the 10% level. The likelihood ratio test in the extended Box–Cox model shows that the double-log form cannot be rejected at the 5% level while the linear form can be rejected at the 5% level. The CUSUM and CUSUMSQ tests show that the money demand function was relatively stable.      

The Leverage of Protest: Market,Media, and Reputational Disruption in Social Movement Success

How do social movements gain concessions from large corporations? The ability of protests to attain leverage by imposing disruption costs on their targets is widely assumed but less often tested. In this article, we assess the ability of protests to attain concessions by disrupting three broad sources of interest to firm officials: maximizing shareholder value, gaining positive media, and fostering a well-reputed image. In contrast to the body of research on the benefits to movements from shaping media discourses and damaging the reputations of their targets, we find that only market disruption provides protests with leverage. We show this through statistical analyses of an original database of protests against large corporations in the United States over five years, 2005–2009. This study advances social movement and organizational research by demonstrating the ways in which the interests of large corporations provide insurgents with means of attaining leverage over their targets. It also speaks to the broad debate over the importance of disrupting the material versus symbolic interests of movement targets. Our results suggest that when it comes to obtaining concessions from large corporations, it is material disruption and not symbolic disruption that provides movements with leverage.     

‘We feel the responsibility that you shirk’: movement institutionalization,the politics of responsibility and the case of the Swedish environmental movement

This article provides directions for advancing the conceptualization of the relationship between social movements and institutionalization, based on a case study of the Swedish environmental movement strategies. We argue that the concepts of (de)responsibilization and (de)politicization provide tools for an improved analysis of the dynamics of how social movements interact both with established political institutions and corporations in a new context. The introduction of new regulatory frameworks in environmental politics has shaped interaction between social movements and the state in new ways, involving neoliberal responsibilization, meaning active involvement by civil society and business in political responsibilities previously associated with state agencies – a development involving an increasing emphasis on market mechanisms. We argue that this has involved a de-politicization of environmental issues in the sense that it engages political actors in a moral discourse and a technocratic practice that suppresses the (potential) articulation of social conflict through consensus building. However, we also show how movement actors resist the discourse that encourages them to take on certain responsibilities, thus engaging in a politics of responsibility. Empirically, we demonstrate how the changing strategies of the Swedish environmental movement in the 2000s need to be understood in relation to the following processes, indicating that the Swedish case has a general relevance for an understanding of the contemporary environmental movement globally: (1) the transformation of the Swedish model of welfare capitalism under the influence of neoliberal discourse; (2) international environmental policy developments, most importantly the emergence of climate change as a dominant issue globally.     

Capital Dependence,Financial Risk,and Change from the Multidivisional to the Multilayered Subsidiary Form

Students of the modem corporation continue to assume that corporations have the same form as they did before the turbulent 1980s when the economy became increasingly globalized and competitive. Our analysis shows that corporations are changing from the multidivisional form to a multilayered subsidiary form. Previous research showed that most corporations were multidivisional in the late 1970s. However, by 1993, 42% of the largest 100 industrial corporations had one or no divisions. The mean number of divisions per corporation declined from 8.8 in 1981 to 4 in 1993, while the mean number of domestic subsidiary corporations increased from 23 in 1981 to 51 in 1993. Parent corporations are creating a hierarchy of subsidiary corporations. Most of these changes occurred after the mid-1980s change in state business policy. The theoretical framework historicizes the corporation by identifying how capital accumulation constraints and changes in the institutional arrangements (e.g., the state) within which corporations are embedded created motives and behaviors that resulted in a change in the corporate form. Findings from logistic regression suggest that corporations that have low profits, have low working capital, have a decline in dividend payments, and manufacture high-risk, liability prone product lines have an increased probability of change to the multilayered subsidiary form. Our results provide support for the capital dependence perspective.     

How age discrimination in employment affects stockholders

We analyze the impact on stock prices, and thus on stockholders, of 84 newspaper announcements regarding corporate age discrimination lawsuits. We find that, on average, initial announcements cause a 2 percent decline in stock price, a $40 million average loss in total stock value for the large firms charged. The stock price decreases are consistent with investor concerns about the firms’ ability to attract and retain good employees given the discrimination charges. Though age discrimination in employment is a pervasive and growing problem, such findings may discourage managers from engaging in discriminatory practices. The authors thank Jane Blank and Malcolm Matthew for helpful comments. This research was supported by a University of Windsor Research Board Grant.     

Corporate Linkage and Control of the Corporate Economy: New Evidence and a Reinterpretation*

This paper begins with a brief critical review of the major perspectives in the debate concerning ownership and control of major corporations. After examination of a new source of data compiled by a Senate committee (pertaining especially to the expansion of stock control by institutional investors and, most importantly, by major commercial banks), we argue that none of these perspectives is strongly supported. In concluding we tentatively outline a perspective wliicli seems to provide a better “fit” to the data. We argue that the dominant force in the overall capitalist economy is now an “intercorporate complex” of major corporations, with banks in a central coordinating position (though short of “control”) and an inner group of the “corporate class” providing the human linkage. This form of control is what we call “intercorporate control,” based upon the impersonal interests of major, interrelated corporate bureaucracies.     

Corporate Involvement in Community Affairs*

An extensive monitoring of the Jones and Laughlin (J&L) steel mill in Hennepin, Illinois suggests that absentee-owned corporations have the ability to involve themselves in local community affairs while maintaining an illusion of non-involvement. Three techniques J&L employed to exert influence are described: unilateral actions, cooptation, and intervention. The failure of reputational leadership data to identify corporate influentials is used to suggest both the success J&L had in concealing corporate influence and the inadequacy of the reputational technique for fully identifying power structures in verticalized communities.     

BUSINESS RESOURCES AND TAXATION: A CROSS-SECTIONAL EXAMINATION OF THE RELATIONSHIP BETWEEN ECONOMIC ORGANIZATION AND PUBLIC POLICY

Many writers have speculated about the connection between economic resources of corporations and their ability to dominate politics in democratic societies with advanced capitalist economies. Using a cross-sectional analysis of business taxes in the American states, this study examines the political impact of four economic resources that are plausibly related to heightened business political influence. With seven factors held constant, I find that states with larger enterprises are most likely to have lower taxes on manufacturing, but concentrated sales do not have any effect on these taxes. The degree to which the organizational efforts of firms are handicapped because industry products are diverse also has an independent relationship with state and local taxes paid by manufacturers, but this relationship does not hold when the least industrial states are excluded from the equations. I also find that where competition between political parties is most intense, tax policies will be less likely to favor business interests. It follows that the evidence in this study is consistent with a hypothesis that firms can translate their formidable economic resources into political influence at the state and local level.     

Social Accountability as an Innovative Frame in Civic Action: The Case of Rede Nossa São Paulo

In the past three decades, Brazil’s state and civil society have undergone a transformation. Non-profit organizations have proliferated, revealing new opportunities for participation, while sustainability and corporate social responsibility have produced new agendas for corporations. Against this background, accountability has emerged within the debate, particularly with regard to governmental transparency and efficiency. This paper examines the Rede Nossa São Paulo movement, which pledges social justice and sustainability and promotes social accountability as its main strategy to achieve its mission. Thus, the main objective of this study is to understand social accountability; more broadly, the goal is to examine governmental accountability in the mobilization process developed by Rede Nossa São Paulo by referring to the framing perspective as a core aspect in the understanding of social movements. Social accountability is presented as a frame that is composed of the union between movements that are historically bonded by the motto of social justice and other groups that are related to urban development and social and environmental responsibility.     

FORECASTING CRUDE OIL PRICE MOVEMENTS WITH OIL‐SENSITIVE STOCKS

This paper uses monthly data from 1984:M10 to 2012:M8 to show that oil‐sensitive stock price indices, particularly those in the energy sector, have strong power in predicting nominal and real crude oil prices at short horizons (1‐month‐ahead predictions), using both in‐ and out‐of‐sample tests. In particular, the forecasts based on oil‐sensitive stock price indices are able to outperform significantly the no‐change forecasts. For example, using the NYSE Arca (AMEX) oil index as a predictor, the 1‐month‐ahead forecasts for nominal crude oil prices reduce the mean squared prediction error by between 22% (for the West Texas Intermediate oil price) and 28% (for the Dubai oil price). Moreover, we find that the directional forecast based on the AMEX oil index is significantly better than a 50:50 coin toss. The novelty of this analysis is that it proposes a new and valuable predictor that both reflects timely market information and is readily available for forecasting the spot oil price.(JEL G17, Q43, Q47, C53)     

Corporate Form and the State: Business Policy and Change from the Multidivisional to the Multilayered Subsidiary Form*

The largest industrial corporations are changing to a multilayered subsidiary form. Whereas corporations have used subsidiaries to organize their assets since the tum of the century, the number of wholly owned subsidiaries in the 100 largest industrial corporations doubled between 1981 and 1993. The question addressed here is: Why are corporations changing their form now? I suggest that the question is historically contingent and that the answer is, in part, explained by changes in state business policy. A capital dependence framework is elaborated to examine the relationship between state business policy and corporations in the 1970s and 1980s. Business policy changes–resulting in the Tax Reform Act of 1986 and the Revenue Act of 1987–provided corporations with tax-free procedures for parent companies to simultaneously restructure their divisions as subsidiaries and restructure their debt. There are additional incentives for corporations to restructure their divisions as subsidiaries: (1) creating a liability firewall between the parent company and its subsidiary corporations, limiting the financial risk of parent companies, and (2) creating an internal capital market, providing an alternative form of financing thereby reducing corporations’dependence on external capital markets.     

Fair Trade: Social regulation in global food markets

This article analyzes the theoretical and empirical parameters of social regulation in contemporary global food markets, focusing on the rapidly expanding Fair Trade initiative. Fair Trade seeks to transform North/South relations by fostering ethical consumption, producer empowerment, and certified commodity sales. This initiative joins an array of labor and environmental standard and certification systems which are often conceptualized as “private regulations” since they depend on the voluntary participation of firms. I argue that these new institutional arrangements are better understood as “social regulations” since they operate beyond the traditional bounds of private and public (corporate and state) domains and are animated by individual and collective actors. In the case of Fair Trade, I illuminate how relational and civic values are embedded in economic practices and institutions and how new quality assessments are promoted as much by social movement groups and loosely aligned consumers and producers as they are by market forces. This initiative's recent commercial success has deepened price competition and buyer control and eroded its traditional peasant base, yet it has simultaneously created new openings for progressive politics. The study reveals the complex and contested nature of social regulation in the global food market as movement efforts move beyond critique to institution building.     

MANAGERS' COMPENSATION AND MISREPORTING: A COSTLY STATE VERIFICATION APPROACH

We look for the optimal shareholder-manager contract leading to high effort and truthful revelation of firm performance. This twofold incentive compatibility constraint calls for a convex compensation scheme (a fixed wage plus a stock option) coupled with a state contingent audit. In order to reduce expected verification costs, an optimal stock option plan assigns the manager a large number of options with high strike price. It is suggested that focusing the audit activity (and supervision) on the exercise of stock option packages is a better solution to the problem of misreporting than giving up stock options as a compensation tool. ( JEL D82, G30, M40, M52)     

State-Corporate Relationships in an Era of Shifting Regime: The Case of Corporate Law Reform in Israel

Different aspects of the relationship between state and economy have traditionally been examined, yet corporate governance and specifically corporate law have received less attention. This article focuses on the legislation of the new corporate law in Israel at the end of the 1990s, which took place during regime transformation from an interventionist state to a regulatory state. The article makes specific reference to three disputes: the lifting of the corporate veil, the separation of the positions of chairman of the board and chief executive officer, and the obligation of private firms to disclose financial reports. This article suggests that despite the transformation of the regime, state actors have continuously been involved via corporate law in the governance of corporations and their relationship with the environment. However, corporate law enables corporations to constrain state power and the state's influence on property rights.     

How Investor Relations Contributes to the Corporate Bottom Line

Investor relations officers say that one of the biggest challenges of their work is proving to the senior management that investor relations contributes value to the organization. This study provides an initial step in evaluating investor relations' contribution to an organization's bottom line. The study first offers a theoretical overview of academic and professional literature dealing with the contribution of investor relations to the organizational bottom line. Second this theoretical overview serves as a starting point for an empirical investigation organized as a Delphi panel. Investor relations officers from corporations and investor relations agencies were recruited to participate in the panel and share their practical insights in response to the theoretically identified indicators of investor relations value. As a result, the study found 4 key areas of investor relations contribution: fair share price, improved liquidity of stock, enhanced analyst coverage, and building and maintaining investor relationships.