The Foundations of Managerial Control in the United States

Mary O'Sullivan

in Contests for Corporate Control

Published in print June 2001 | ISBN: 9780199244867
Published online November 2003 | e-ISBN: 9780191596735 | DOI:
 The Foundations of Managerial Control in the United States

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In historical perspective, market control over the allocation of US corporate resources stands out as a recent phenomenon, since for most of the twentieth century, salaried managers have exercised control over resource allocation by US corporate enterprises. In this chapter, the lengthy and complex historical process through which the institutional foundations of managerial control emerged in the US corporate economy is discussed. The focusing, in particular, is on the role of the integration of managers as members of business organizations, the diffusion of share ownership, the changing interaction between the stock market and the public corporation, and the transformation of corporate law in facilitating the separation of beneficial ownership of corporate stock from strategic control over the allocation of corporate resources. The main sections of the chapter are: 3.2, The historical foundations of managerial control; 3.3, Managerial control and the Great Depression; 3.4, and New deals, old deals––which discusses changes in corporate governance, workers’ rights and unionism, and defence of the corporate manager's right to manage.

Keywords: beneficial ownership; corporate economy; corporate governance; corporate law; corporate resources; corporate stock; Great Depression; history; institutions; manager's rights; managerial control; resource allocation; share ownership; strategic control; unionism; USA; workers’ rights

Chapter.  18632 words. 

Subjects: Microeconomics

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