Within the LPE movement, there is a broad consensus that “law is central to the creation and maintenance of structural inequalities in the state and the market” and that “class power is inextricably connected to the development of racial and gender hierarchies." These claims, while often articulated in response to neoliberalism, go to the very origins of capitalism and its particular patterns of inequality.
Electricity, trucking, telephones, and banking: each of these sectors represents an exception to the mainstream model of efficient markets. They are typified by network effects, positive spillovers, high startup costs, and highly variable load rates. They have also experienced severe degradation from the privatization and deregulation that pervade life in the past half century. Networks, Platforms & Utilities promises a new approach to these sectors and others, one that makes the book an important pedagogical pathway for the emerging Law and Political Economy movement.
In the prior two posts in this set I described how the leading mainstream economic explanation of rising inequality and its primary critique treat technology. Here, what I’ll try to do is synthesize out of the work of many of us in the field an understanding of a political economy of technology that gives technology a meaningful role in the dynamic, but integrates it with institutions and ideology such that it becomes an appropriate site of struggle over the pattern of social relations, rather than either a distraction or a source of legitimation.
Yesterday, I outlined the ways in which the dominant “skills-biased technical change” and “winner-take-all economics” explanations of inequality share an idealized view of both markets and technology as natural and necessary. Today I’ll write about the most influential criticism of these dominant stories that have been developed by labor economists. These focus on the central role that institutional choices played in shaping bargaining power, and through it, the ability of the managerial class and shareholders to cause stagnating wages for the median worker and the great extraction by the 1%.
If we think that that platforms and robots, ubiquitous sensors and algorithms do exert a real influence on the pattern of social relations that make up the economy, but we doubt that technology causes inequality by a “natural” process driven by its own intrinsic affordances and constraints interacting with markets, then we owe ourselves a clearer story than we have given to this point. In today’s post, I’ll describe the limits of the mainstream economists’ answer, which lies at the foundation of “the robots will take all the jobs” and the legitimation of winner-take-all markets.