Corporate decisions with regard to retained earnings act as a constraint to the consumption-saving decisions of all shareholders, except those who take the decisions - the controlling group. The latter exhibit a preference for a higher retention ratio than the non-controlling share-holders and tend to realize their "preferences." Given less than perfect substitution between corporate and personal saving, this tends to increase aggregate financial capital accumulation.
Get full access to this article
View all access options for this article.
References
1.
Aaronovitch, S.1961. The Ruling Class. Connecticut: Greenwood Press.
2.
Aaronovitch, S.
and R. Smith. (with I. Gardiner, and R. Moore). 1981. The Political Economy of British Capitalism: A Marxist Analysis. London: McGraw-Hill.
3.
Ando, A.
and F. Modigliani. 1963. The Life Cycle Hypothesis of Savings: Aggregate Implications and Tests. American Economic Review 53.
4.
Baran, P.
and P. Sweezy. 1967. Monopoly Capital. New York: Penguin.
5.
Berle, A. J.
and C. G. Means. 1967. The Modern Corporation and Private Property. New York: Harcourt Brace and World.
6.
Cowling, K.1982. Monopoly Capitalism. New York: MacMillan.
7.
Cubbin, J.
and D. Leech. 1983. The Effects of Shareholding Dispersion on the Degree of Control in British Companies: Theory and Measurement. Economic Journal.
8.
Davidson, J.
, D. Hendry, F. Srba, and S. Yeo. 1976. Econometric Modelling of the Aggregate Time-Series Relationship Between Consumers' Expenditure and Income in the United Kingdom. Economic Journal.
9.
Drucker, F. P.1976. The Unseen Revolution: How Pension Funds Socialism Came to America. New York: Harper and Row.
10.
Duesenberry, J. S.1967. Income, Saving and the Theory of Consumer Behaviour. New York: Oxford University Press.
11.
Fitch, R.1972. Reply to James O'Connor. Socialist Revolution7.
12.
Francis, A.1980. Families, Firms and Finance Capital: The Development of the UK Industrial Firms with Particular Reference to their Ownership and Control. Sociology14.
13.
Friedman, M.1957. A Theory of the Consumption Function. Princeton, NJ: Princeton University Press.
14.
Galbraith, J. K.1967. The New Industrial State. New York: Penguin.
15.
Green, F.1982. Occupational Pension Schemes and British Capitalism. Cambridge Journal of Economics6.
16.
Green, H. A.1971. Consumer Theory. New York: Penguin.
17.
Harrod, A.1978. Towards a Dynamic Economics. New York: Macmillan.
18.
Hay, D. A.
and D. J. Morris. 1979. Industrial Economics: Theory and Evidence. New York: Oxford University Press.
19.
Hilferding, R.1981. Finance Capital. London: Routledge and Kegan.
20.
Kaldor, N.1960. Essays in Value and Distribution. London: Duckworth Ltd.
21.
Kalecki, M.1971. Dynamics of the Capitalist Economy. New York: Cambridge University Press.
22.
Lambrinides, M. 1972. Saving, Distribution and Social Choice: A Study of the Relationship Between Personal and Organizational Saving. Unpublished Ph.D. thesis, Harvard University.
23.
Leech, D.1984. The Separation of Corporate Ownership and Control: A Reinterpretation of the Evidence by Berle and Means. Warsick Economic Research Papers, No. 247.
24.
Mandel, E.1967. The Labour Theory of Value and "Monopoly Capitalism."International Socialist Review.
25.
Marglin, S.1975a. What Do Bosses Do? The Origins and Functions of Hierarchy in Capitalist Production. Part II. Review of Radical Political Economics.
26.
Marglin, S.1975b. What Do Bosses do? Postscript. Harvard Institute of Economic Research Discussion Paper No. 429.
27.
Marris, R.1967. The Economic Theory of Managerial Capitalism. London: Macmillan.
28.
Mayer, T.1972. Permanent Income, Wealth and Consumption: A Critique of the Permanent Income Theory, the Life Cycle Hypothesis, and Related Theories. Berkeley, CA: University of California Press.
29.
Minns, R.1981. Pension Funds and British Capitalism: The Ownership and Control of Shareholding. London: Heinemann.
30.
Minns, R.1982. Take Over the City: The Case for Public Ownership of Financial Institutions. London: Pluto Press.
31.
Modigliani, F.1970. The Life Cycle Hypothesis of Saving and Intercountry Differences in the Savings Ratio. In, Induction, Growth and Trade. Essays in Honour of Sir Roy Harrod, W. Ellis et al. (eds.). New York: Oxford University Press.
32.
Pearce, I. F.
and S. H. Thomas. 1980. The Personal Savings Paradox. University of Southampton, Discussion Paper No. 8025.
33.
Pitelis, C. N. 1984. Corporate Control, Social Choice and Financial Capital Accumulation. Unpublished Ph.D. thesis, University of Warwick.
34.
Pitelis, C. N.1985. The Effects of Life Assurance and Pension Funds on Other Savings: The Postwar UK Experience. Bulletin of Economic Research.
35.
Pitelis, C. N.
and R. Sugden. 1985. The Separation of Ownership and Control in the Theory of the Firm: A Reappraisal. International Journal of Industrial Organisation.
36.
Scott, J.1979. Corporations, Classes and Capitalism. London: Hutchinson.
37.
Solow, R. M.1967. The New Industrial State or Son of Affluence. The Public Interest.
38.
Tobin, J.1980. Asset Accumulation and Economic Activity. Oxford: Basil Blackwell.
39.
Wood, A.1975. A Theory of Profits. Cambridge: Cambridge University Press.
40.
Zeitlin, M.1974. Corporate Ownership and Control: The Large Corporations and the Capitalist Class. American Journal of Sociology79.
