Rescheduled from April 16, 2018
Changes in firm strategy and structure largely explain the sources and consequences of the global economic slowdown and part of the current populist political wave. Firms’ profit strategies now center on robust intellectual property (patent, copyright, trademark, brand) portfolios and other sources of monopoly power and maximize return on assets by shrinking their labor and physical capital footprint to the minimum. This produces an upside-down profit pyramid with human capital-intensive firms at the top, physical capital-intensive firms the middle and labor-intensive firms at the bottom. Headcount, meanwhile, resembles a traditional ‘wedding’ cake, producing massive inequality of income and profits. Income inequality slows consumption growth, and profit inequality reduces productive investment, slowing GDP growth. All of these are susceptible to remediation through proper public policy.
About the speaker
Herman Mark Schwartz is the Fulbright Research Chair in Global Governance at the Balsillie School of International Affairs. Dr. Schwartz is interested in the how the structure of property rights, especially intellectual property rights, affects economic growth and the distribution of income nationally and globally.