New Ideas in the Tradition of Galbraith
New Directions in Modern Economics series
Edited by Blandine Laperche, James K. Galbraith and Dimitri Uzunidis
Chapter 1: Professionals’ Capitalism and Democracy
Luiz Carlos Bresser-Pereira 1. INTRODUCTION The twentieth century will be known in the future for many major changes: it was the century of technological progress, the century of organizations rather than of family units of production and the century in which the number of bureaucrats increased so much as to merit being identified as social class – the professional middle class. In connection with these changes, it was the century when knowledge eventually became the decisive factor of production, and the control of technological, organizational, and communicative knowledge turned strategic. Yet it was also the century of democracy, which represents a check to this new power, while at the same time it is conditioned by it. While changes occurred in the social and political spheres, economies experienced enormous growth and became much more complex. In this process, markets assumed a major role in coordinating economies – by allocating factors of production employed by business enterprises – but, obviously, the coordination of the whole system surpassed by far, their possibilities. At the macro political level, the role of the state and of the institutional or legal system which it creates and enforces increased enormously. At the level of civil society (of politically organized society), corporative organizations, and, after that, social accountability organizations increased in number and influence, acting as control mechanisms of governments. Concurrently, at the economic realm, large business corporations, and all other types of large organizations, became dominant everywhere. Firms required entrepreneurs, organizations demanded managers or professionals covering an increasing larger spectrum...
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