Direct democracy or pure democracy is a form of democracy in which people decide on policy initiatives directly. This differs from the majority of established democracies, which are representative democracies. In a representative democracy, people vote for representatives who enact policy initiatives. In direct democracy, people decide on policies without any intermediary. Depending on the particular system in use, direct democracy might entail passing executive decisions, the use of sortition, making laws, directly electing or dismissing officials, conducting trials. Two leading forms of direct democracy are participatory deliberative democracy. Semi-direct democracies in which representatives administer day-to-day governance, but the citizens remain the sovereign, allow for three forms of popular action: referendum and recall; the first two forms—referendums and initiatives—are examples of direct legislation. In 2019, Thirty countries allowed for referendum initiated by the population on the national levelA'compulsory referendum' subjects the legislation drafted by political elites to a binding popular vote.
This is the most common form of direct legislation. A'popular referendum' empowers citizens to make a petition that calls existing legislation to a vote by the citizens. Institutions specify the timeframe for a valid petition and the number of signatures required, may require signatures from diverse communities to protect minority interests; this form of direct democracy grants the voting public a veto on laws adopted by the elected legislature, as is done in Switzerland. A'citizen-initiated referendum' empowers members of the general public to propose, by petition, specific statutory measures or constitutional reforms to the government and, as with referendums, the vote may be binding or advisory. Initiatives may be direct or indirect: With the direct initiative, a successful proposition is placed directly on the ballot to be subject to vote. With an indirect initiative, a successful proposition is first presented to the legislature for their consideration; such a form of indirect initiative is utilized by Switzerland for constitutional amendments.
A deliberative referendum is a referendum that increases public deliberation through purposeful institutional design. Power of recall gives the public the power to remove elected officials from office before the end of their term; the earliest known direct democracy is said to be the Athenian democracy in the 5th century BC, although it was not an inclusive democracy: women and slaves were excluded from it. The main bodies in the Athenian democracy were the assembly, composed of male citizens. There were only about 30,000 male citizens, but several thousand of them were politically active in each year, many of them quite for years on end; the Athenian democracy was direct not only in the sense that decisions were made by the assembled people, but in the sense that the people through the assembly, boulê, law courts controlled the entire political process, a large proportion of citizens were involved in the public business. Modern democracies, being representative, not direct, do not resemble the Athenian system.
Relevant to the history of direct democracy is the history of Ancient Rome the Roman Republic, beginning around 509 BC. Rome displayed many aspects of democracy, both direct and indirect, from the era of Roman monarchy all the way to the collapse of the Roman Empire. Indeed, the Senate, formed in the first days of the city, lasted through the Kingdom and Empire, continued after the decline of Western Rome; as to direct democracy, the ancient Roman Republic had a system of citizen lawmaking, or citizen formulation and passage of law, a citizen veto of legislature-made law. Many historians mark the end of the Republic with the passage of a law named the Lex Titia, 27 November 43 BC, which eliminated many oversight provisions. Modern-era citizen lawmaking began in the towns of Switzerland in the 13th century. In 1847, the Swiss added the "statute referendum" to their national constitution, they soon discovered that having the power to veto Parliament's laws was not enough. In 1891, they added the "constitutional amendment initiative".
Swiss politics since 1891 have given the world a valuable experience base with the national-level constitutional amendment initiative. In the past 120 years, more than 240 initiatives have been put to referendums; the populace has been conservative. Some of the issues surrounding the related notion of a direct democracy using the Internet and other communications technologies are dealt with in e-democracy and below under the term electronic direct democracy. More concisely, the concept of open source governance applies principles of the free software movement to the governance of people, allowing the entire populace to participate in government directly, as much or as little as they please. Athenian democracy developed in the Greek city-state of Athens, comprising the city of Athens and the surrounding territory of Attica, around 600 BC. Athens was one of the first known democracies. Other Greek cities set up democracies, though most
Legalism (Chinese philosophy)
Fajia or Legalism is one of Sima Tan's six classical schools of thought in Chinese philosophy. Meaning "house of Fa", the "school" represents some several branches of realistic statesmen or "men of methods" foundational for the traditional Chinese bureaucratic empire. Compared with Machiavelli, they have been considered in the Western world as akin to the Realpolitikal thought of ancient China, emphasizing a realistic consolidation of the wealth and power of autocrat and state, with the goal of achieving increased order and stability. Having close ties with the other schools, some would be a major influence on Taoism and Confucianism, the current remains influential in administration and legal practice in China today. Though Chinese administration cannot be traced to any one person, emphasizing a merit system administrator Shen Buhai may have had more influence than any other, might be considered its founder, if not valuable as a rare pre-modern example of abstract theory of administration.
Sinologist Herrlee G. Creel sees in Shen Buhai the "seeds of the civil service examination", and, if one wished to exaggerate, the first political scientist; the correlation between Shen's conception of the inactive ruler responsible for examination into performance and titles also informed the Taoist conception of the formless Tao that "gives rise to the ten thousand things."Concerned with administrative and sociopolitical innovation, Shang Yang was a leading reformer of his time. His numerous reforms transformed the peripheral Qin state into a militarily powerful and centralized kingdom. Much of Legalism was "principally the development of certain ideas" that lay behind his reforms, it was these that helped lead to Qin's ultimate conquest of the other states of China in 221 BC. Shen's most famous successor Han Fei synthesized the thought of the other "Fa-Jia" in his eponymous text, the Han Feizi. Written around 240 BC, the Han Feizi is thought of as the greatest of all Legalist texts, is believed to contain the first commentaries on the Tao te Ching in history.
The grouping together of thinkers that would be dubbed "Fa-Jia" or "Legalists" can be traced to him, The Art of War would seem to incorporate Taoist philosophy of inaction and impartiality, Legalist punishment and rewards as systematic measures of organization, recalling Han Fei's concepts of power and tactics. Attracting the attention of the First Emperor, It is said that succeeding emperors followed the template set by Han Fei. Calling them the "theorists of the state", sinologist Jacques Gernet considered the Legalists/Fa-Jia to be the most important tradition of the fourth and third centuries BC, the entire period from the Qin dynasty to Tang being characterized by its centralizing tendencies and economic organization of the population by the state; the Han dynasty took over the governmental institutions of the Qin dynasty unchanged. Endorsement for the "school" of thought peaked under Mao Zedong, hailed as a "progressive" intellectual current; the Zhou dynasty was divided between the hereditary noblemen.
The latter were placed to obtain office and political power, owing allegiance to the local prince, who owed allegiance to the Son of Heaven. The dynasty operated according to the principles of punishment; the former was applied only to aristocrats, the latter only to commoners. The earliest Zhou kings kept a firm personal hand on the government, depending on their personal capacities, personal relations between ruler and minister, upon military might; the technique of centralized government being so little developed, they deputed authority to feudal lords. When the Zhou kings could no longer grant new fiefs, their power began to decline, vassals began to identify with their own regions, schismatic hostility occurred between the Chinese states. Aristocratic families became important, by virtue of their ancestral prestige wielding great power and proving a divisive force. In the Spring and Autumn period, rulers began to directly appoint state officials to provide advice and management, leading to the decline of inherited privileges and bringing fundamental structural transformations as a result of what may be termed "social engineering from above."
Most Warring States period thinkers tried to accommodate a "changing with the times" paradigm, each of the schools of thought sought to provide an answer for the attainment of sociopolitical stability. Confucianism considered to be China's ruling ethos, was articulated in opposition to the establishment of legal codes, the earliest of which were inscribed on bronze vessels in the sixth century BC. For the Confucians, the Classics provided the preconditions for knowledge. Orthodox Confucians tended to consider organizational details beneath both minister and ruler, leaving such matters to underlings, furthermore wanted ministers to control the ruler. Concerned with "goodness", the Confucians became the most prominent, followed by the proto-Taoists and the administrative thought that Sima Tan termed the Fa-Jia, but the Taoists focused on the development of inner powers, both the Taoists and Confucians held a regressive view of history, the age being a decline from the era of the Zhou kings. A new type of ruler emerged intent on breaking the power of the aristocrats and reforming their state's bureaucracies.
Those that failed were deposed. As disenfranchised or opportunist aristocrats were attracted by the reform-oriented rulers, they brought with them philosophy concerned foremost with organi
Anarchism is an anti-authoritarian political philosophy that advocates self-governed societies based on voluntary, cooperative institutions and the rejection of hierarchies those societies view as unjust. These institutions are described as stateless societies, although several authors have defined them more as distinct institutions based on non-hierarchical or free associations. Anarchism holds the state to be undesirable and harmful. Anarchism is considered a far-left ideology and much of its economics and legal philosophy reflect anti-authoritarian interpretations of communism, syndicalism, mutualism, or participatory economics; as anarchism does not offer a fixed body of doctrine from a single particular worldview, many anarchist types and traditions exist and varieties of anarchy diverge widely. Anarchist schools of thought can differ fundamentally, supporting anything from extreme individualism to complete collectivism. Strains of anarchism have been divided into the categories of social and individualist anarchism, or similar dual classifications.
The etymological origin of anarchism derives from ancient Greek word anarkhia. Anarkhia meant "without a ruler" as it was composed by the word arkhos; the suffix -ism is used to denote the ideological current that favours anarchism. The first known use of this word was in 1642. Various factions within the French Revolution labelled opponents as anarchists although few shared many views of anarchists. There would be many revolutionaries of the early 19th century who contributed to the anarchist doctrines of the next generation, such as William Godwin and Wilhelm Weitling, but they did not use the word anarchist or anarchism in describing themselves or their beliefs; the first political philosopher to call himself an anarchist was Pierre-Joseph Proudhon, marking the formal birth of anarchism in the mid-19th century. Since the 1890s and beginning in France, the term libertarianism has been used as a synonym for anarchism and its use as a synonym is still common outside the United States. On the other hand, some use libertarianism to refer to individualistic free-market philosophy only, referring to free-market anarchism as libertarian anarchism.
While opposition to the state is central, defining anarchism is not an easy task as there is a lot of talk among scholars and anarchists on the matter and various currents perceive anarchism differently. Hence, it might be true to say that anarchism is a cluster of political philosophies opposing authority and hierarchical organization in the conduct of all human relations in favour of a society based on voluntary association and decentralisation, but this definition has its own shortcomings as the definition based on etymology, or based on anti-statism or the anti-authoritarian. Major elements of the definition of anarchism include: a) the will for a non coercive society. During the prehistoric era of mankind, an established authority did not exist, it was after the creation of towns and cities that hierarchy was invented and anarchistic ideas espoused as a reaction. Most notable examples of anarchism in the ancient world were in Greece. In China, philosophical anarchism, meaning peaceful delegitimizing of the state, was delineated by Taoist philosophers.
In Greece, anarchist attitudes were articulated by tragedians and philosophers. Aeschylus and Sophocles used the myth of Antigone to illustrate the conflict of personal autonomy with the state rules. Socrates questioned Athenian authorities and insisted to the right of individual freedom of consciousness. Cynics associated authorities while trying to live according to nature. Stoics were supportive of a society based on unofficial and friendly relations among its citizens without the presence of a state. During the Middle Ages, there was no anarchistic activity except some ascetic religious movements in the Islamic world or in Christian Europe; this kind of tradition gave birth to religious anarchism. In Persia, a Zoroastrian Prophet known as Mazdak was calling for an egalitarian society and the abolition of monarchy, but he soon found himself executed by the king. In Basra, religious sects preached against the state. In Europe, various sects developed anti-state and libertarian tendencies; those currents were the precursor of religious anarchism in the centuries to come.
It was in the Renaissance and with the spread of reasoning and humanism through Europe that libertarian ideas emerged. Writers were outlining in their novels ideal societies that were based not on coercion but voluntarism; the Enlightenment further pushed towards anarchism with the optimism for social progress. The turning point towards anarchism was the French Revolution in which the anti-state and federalist sentiments began to take a form by Enragés and sans-culottes; some prominent figures of anarchism begun developing the first anarchist currents. That is the era of classical anarchism that lasted until the end of the Spanish Civil War of 1936 and was the golden age of anarchism. William Godwin espoused philosophical anarchism in England morally delegitimizing the state, Max Stirner's thinking paved the way to individualism and Pierre-Joseph Proudhon's theory of mutualism found fertile soil in France. Michael Bakunin took mutualism and extended
Libertarianism is a collection of political philosophies and movements that uphold liberty as a core principle. Libertarians seek to maximize political freedom and autonomy, emphasizing freedom of choice, voluntary association and individual judgment. Libertarians share a skepticism of authority and state power, but they diverge on the scope of their opposition to existing political and economic systems. Various schools of libertarian thought offer a range of views regarding the legitimate functions of state and private power calling for the restriction or dissolution of coercive social institutions. Traditionally, libertarianism was a term for a form of left-wing politics; such left-libertarian ideologies seek to abolish capitalism and private ownership of the means of production, or else to restrict their purview or effects, in favor of common or cooperative ownership and management, viewing private property as a barrier to freedom and liberty. Classical libertarian ideologies include—but are not limited to—anarcho-communism, anarcho-syndicalism and egoism, alongside many other anti-paternalist, New Left schools of thought centered around economic egalitarianism.
Modern right-libertarian ideologies, such as minarchism and anarcho-capitalism, co-opted the term in the mid-20th century to instead advocate laissez-faire capitalism and strong private property rights such as in land and natural resources. The first recorded use of the term libertarian was in 1789, when William Belsham wrote about libertarianism in the context of metaphysics; as early as 1796, the word libertarian came to mean an advocate or defender of liberty in the political and social spheres, when the London Packet printed on 12 February the following: "Lately marched out of the Prison at Bristol, 450 of the French Libertarians". The word was again used in a political sense in 1802 in a short piece critiquing a poem by "the author of Gebir" and has since been used with this meaning; the use of the word libertarian to describe a new set of political positions has been traced to the French cognate libertaire, coined in a letter French libertarian communist Joseph Déjacque wrote to mutualist Pierre-Joseph Proudhon in 1857.
Déjacque used the term for his anarchist publication Le Libertaire, Journal du mouvement social, printed from 9 June 1858 to 4 February 1861 in New York City. Sébastien Faure, another French libertarian communist, began publishing a new Le Libertaire in the mid-1890s while France's Third Republic enacted the so-called villainous laws which banned anarchist publications in France. Thus, libertarianism has been used as a synonym for anarchism and libertarian socialism since this time; the term libertarianism was first used in the United States as a synonym for classical liberalism in May 1955 by writer Dean Russell, a colleague of Leonard Read and a classical liberal himself. Russell justified the choice of the word as follows: "Many of us call ourselves'liberals.' And it is true that the word'liberal' once described persons who respected the individual and feared the use of mass compulsions. But the leftists have now corrupted that once-proud term to identify themselves and their program of more government ownership of property and more controls over persons.
As a result, those of us who believe in freedom must explain that when we call ourselves liberals, we mean liberals in the uncorrupted classical sense. At best, this is subject to misunderstanding. Here is a suggestion: Let those of us who love liberty trade-mark and reserve for our own use the good and honorable word'libertarian'". Subsequently, a growing number of Americans with classical liberal beliefs began to describe themselves as libertarian. One person responsible for popularizing the term libertarian in this sense was Murray Rothbard, who started publishing libertarian works in the 1960s. Rothbard describes this modern use of the words overtly as a "capture" from his enemies, saying that "for the first time in my memory, we,'our side,' had captured a crucial word from the enemy.'Libertarians' had long been a polite word for left-wing anarchists, for anti-private property anarchists, either of the communist or syndicalist variety. But now we had taken it over". Robert Nozick was responsible for popularizing this usage of the term in philosophical circles and Europe instead.
According to common meanings of conservative and liberal, libertarianism in the United States has been described as conservative on economic issues and liberal on personal freedom and it is often associated with a foreign policy of non-interventionism. All libertarians begin with a conception of personal autonomy from which they argue in favor of civil liberties and a reduction or elimination of the state. Left-libertarianism encompasses those libertarian beliefs that claim the Earth's natural resources belong to everyone in an egalitarian manner, either unowned or owned collectively. Contemporary left-libertarians such as Hillel Steiner, Peter Vallentyne, Philippe Van Parijs, Michael Otsuka and David Ellerman believe the appropriation of land must leave "enough and as good" for others or be taxed by society to compensate for the exclusionary effects of private property. Libertarian socialists promote usufruct and socialist economic theories, including communism, collectivism and mutualism.
They criticize the state for being the defender of private property and believe capitalism entails wage slavery. Right-libertarianism developed in the United States in the mid-20th century from the works of Euro
French and Raven's bases of power
In a notable study of power conducted by social psychologists John R. P. French and Bertram Raven in 1959, power is divided into five separate and distinct forms. In 1965 Raven revised this model to include a sixth form by separating the informational power base as distinct from the expert power base. Relating to social communication studies, power in social influence settings has introduced a large realm of research pertaining to persuasion tactics and leadership practices. Through social communication studies, it has been theorized that leadership and power are linked, it has been further presumed that different forms of power affect one's success. This idea is used in organizational communication and throughout the workforce. In a notable study of power conducted by social psychologists John R. P. French and Bertram Raven in 1959, power is divided into five separate and distinct forms, they identified those five bases of power as coercive, legitimate and expert. This was followed by Raven's subsequent identification in 1965 of a sixth separate and distinct base of power: informational power.
Furthermore and Raven defined social influence as a change in the belief, attitude, or behavior of a person which results from the action of another person, they defined social power as the potential for such influence, that is, the ability of the agent to bring about such a change using available resources. Though there have been many formal definitions of leadership that did not include social influence and power, any discussion of leadership must deal with the means by which a leader gets the members of a group or organization to act and move in a particular direction. Whereby, this is to be considered "power" in social influential situations; the original French and Raven model included five bases of power – reward, legitimate and referent – however, informational power was added by Raven in 1965, bringing the total to six. Since the model has gone through significant developments: coercion and reward can have personal as well as impersonal forms. Expert and referent power can be positive.
Legitimate power, in addition to position power, may be based on other normative obligations: reciprocity and responsibility. Information may be utilized in indirect fashion. French and Raven defined social power as the potential for influence (a change in the belief, attitude or behavior of a someone, the target of influence; as we know leadership and power are linked. This model shows how the different forms of power affect one's success; this idea is used in organizational communication and throughout the workforce. "The French-Raven power forms are introduced with consideration of the level of observability and the extent to which power is dependent or independent of structural conditions. Dependency refers to the degree of internalization that occurs among persons subject to social control. Using these considerations it is possible to link personal processes to structural conditions"; the bases of social power have evolved over the years with benefits coming from advanced research and theoretical developments in related fields.
On the basis of research and evidence, there have been many other developments and elaborations on the original theory. French and Raven developed an original model outlining the change dependencies and further delineating each power basis. Though it is a common understanding that most social influence can still be understood by the original six bases of power, the foundational bases have been elaborated and further differentiated. Further Differentiating the Bases of Social Power As mentioned above, there are now six main concepts of power strategies studied in social communication research, they are described as Coercive, Legitimate, Referent and Informational. Additionally, research has shown that source credibility has an explicit effect on the bases of power used in persuasion. Source credibility, the bases of power, objective power, established based on variables such as position or title, are interrelated; the levels of each have levels of one another. The bases of power differ according to the manner in which social changes are implemented, the permanence of such changes, the ways in which each basis of power is established and maintained.
The effectiveness of power is situational. Given there are six bases of power studied in the Communication field, it is important to know the situational uses of each power, focusing on when each is most effective. According to French and Raven, "it is of particular practical interest to know what bases of power or which power strategies are most to be effective, but it is clear that there is no simple answer. For example, a power strategy that works but relies on surveillance may not last once surveillance ends. One organizational study found that reward power tended to lead to greater satisfaction on the part of employees, which means that it might increase influence in a broad range of situations. Coercive power was more effective in influencing a subordinate who jeopardized the success of the overall organization or threatened the leader's authority though in the short term it led to resentment on the part of the target. A power strategy that leads to private acceptance and long-lasting change may be difficult to implement, consume considerable
Theocracy is a form of government in which a religious institution is the source from which all authority derives. The Oxford English Dictionary has this definition: 1. A system of government in which priests rule in the name of a god. 1.1. The commonwealth of Israel from the time of Moses until the election of Saul as King. An ecclesiocracy is a situation where the religious leaders assume a leading role in the state, but do not claim that they are instruments of divine revelation: for example, the prince-bishops of the European Middle Ages, where the bishop was the temporal ruler; such a state may use the administrative hierarchy of the religion for its own administration, or it may have two "arms"—administrators and clergy—but with the state administrative hierarchy subordinate to the religious hierarchy. Theocracy differs from theonomy, the latter of, government based on divine law; the papacy in the Papal States occupied a middle ground between theocracy and ecclesiocracy, since the Pope did not claim he was a prophet who received revelation from God and translated it into civil law.
Religiously endorsed monarchies fall between theocracy and ecclesiocracy, according to the relative strengths of the religious and political organs. Most forms of theocracy are oligarchic in nature, involving rule of the many by the few, some of whom so anointed under claim of divine commission; the word theocracy originates from the Greek θεοκρατία meaning "the rule of God". This in turn derives from θεός, meaning "god", κρατέω, meaning "to rule", thus the meaning of the word in Greek was "rule by god" or human incarnation of god. The term was coined by Flavius Josephus in the first century A. D. to describe the characteristic government of the Jews. Josephus argued that while mankind had developed many forms of rule, most could be subsumed under the following three types: monarchy and democracy; the government of the Jews, was unique. Josephus offered the term "theocracy" to describe this polity, ordained by Moses, in which God is sovereign and his word is law. Josephus' definition was accepted until the Enlightenment era, when the term started to collect more universalistic and negative connotations in Hegel's hands.
The first recorded English use was in 1622, with the meaning "sacerdotal government under divine inspiration". In some religions, the ruler a king, was regarded as the chosen favorite of God who could not be questioned, sometimes being the descendant of, or a god in their own right. Today, there is a form of government where clerics have the power and the supreme leader could not be questioned in action. From the perspective of the theocratic government, "God himself is recognized as the head" of the state, hence the term theocracy, from the Koine Greek θεοκρατία "rule of God", a term used by Josephus for the kingdoms of Israel and Judah. Taken theocracy means rule by God or gods and refers to an internal "rule of the heart" in its biblical application; the common, generic use of the term, as defined above in terms of rule by a church or analogous religious leadership, would be more described as an ecclesiocracy. In a pure theocracy, the civil leader is believed to have a personal connection with the civilization's religion or belief.
For example, Moses led the Israelites, Muhammad led the early Muslims. There is a fine line between the tendency of appointing religious characters to run the state and having a religious-based government. According to the Holy Books, Prophet Joseph was offered an essential governmental role just because he was trustworthy and knowledgeable; as a result of the Prophet Joseph's knowledge and due to his ethical and genuine efforts during a critical economic situation, the whole nation was rescued from a seven-year drought. When religions have a "holy book", it is used as a direct message from God. Law proclaimed by the ruler is considered a divine revelation, hence the law of God; as to the Prophet Muhammad ruling, "The first thirteen of the Prophet's twenty-three year career went on apolitical and non-violent. This attitude changed only after he had to flee from Mecca to Medina; this hijra, or migration, would be a turning point in the Prophet's mission and would mark the beginning of the Muslim calendar.
Yet the Prophet did not establish a theocracy in Medina. Instead of a polity defined by Islam, he founded a territorial polity based on religious pluralism; this is evident in a document called the ’Charter of Medina’, which the Prophet signed with the leaders of the other community in the city."According to the Quran, Prophets were not after power or material resources. For example in surah 26 verses, the Koran quotes from Prophets, Hud, Salih and Shu'aib that: "I do not ask you for it any payment. While, in theocracy many aspects of the holy book are overshadowed by material powers. Due to be considered divine, the regime entitles itself to interpret verses to its own benefit and abuse them out of the context for its political aims. An ecclesiocracy, on the other hand, is a situation where the religious leaders assume a leading role in the state, but do not claim that they are instruments of divine revelation. For example, the prince-bishops of the European Middle Ages, where the bishop was the temporal ruler.
Such a state may use the administrative hierarchy of the religion for its own administration, or it may have two "arms"—administrators and clergy—but
Corporatocracy (, from corporate and Greek: -κρατία, translit. -kratía, lit.'domination by', short form corpocracy, is a recent term used to refer to an economic and political system controlled by corporations or corporate interests. It is most used as a term to describe the economic situation in a particular country; this is different from corporatism, the organisation of society into groups with common interests. Corporatocracy as a term is used by observers across the political spectrum. Economist Jeffrey Sachs described the United States as a corporatocracy in The Price of Civilization, he suggested that it arose from four trends: weak national parties and strong political representation of individual districts, the large U. S. military establishment after World War II, large corporations using money to finance election campaigns, globalization tilting the balance of power away from workers. This collective is what author C Wright Mills in 1956 called the "power elite", wealthy individuals who hold prominent positions in corporatocracies.
They control the process of determining a society's political policies. The concept has been used in explanations of bank bailouts, excessive pay for CEOs as well as complaints such as the exploitation of national treasuries and natural resources, it has been used by critics of globalization, sometimes in conjunction with criticism of the World Bank or unfair lending practices as well as criticism of "free trade agreements". Edmund Phelps published an analysis in 2010 theorizing that the cause of income inequality is not free market capitalism, but instead is the result of the rise of corporatization. In this view, corporatization is the antithesis of free market capitalism, it is characterized by semi-monopolistic organizations and banks, big employer confederations acting with complicit state institutions, in ways that discourage the natural workings of a free economy. The primary effects of corporatization are the consolidation of economic power and wealth, with the end results being the attrition of entrepreneurial and free market dynamism.
His follow-up book, Mass Flourishing, further defines corporatization by the following attributes: power-sharing between government and large corporations, an expansion of corporate lobbying and campaign support in exchange for government reciprocity, escalation in the growth and influence of financial and banking sectors, increased consolidation of the corporate landscape through merger and acquisition, increased potential for corporate/government corruption and malfeasance, a lack of entrepreneurial and small business development leading to lethargic and stagnant economic conditions. In the United States, several of the characteristics described by Phelps are apparent. With regard to income inequality, the 2014 income analysis of University of California, Berkeley economist Emmanuel Saez confirms that relative growth of income and wealth is not occurring among small and mid-sized entrepreneurs and business owners, but instead only among the top.1 percent of income distribution, whom economics Nobel Prize winner, Paul Krugman describes as "super-elites – corporate bigwigs and financial wheeler-dealers" who earn $2,000,000 or more every year.
Corporate power can increase income inequality. Nobel Prize winner of economics Joseph Stiglitz wrote in May 2011: "Much of today’s inequality is due to manipulation of the financial system, enabled by changes in the rules that have been bought and paid for by the financial industry itself—one of its best investments ever; the government lent money to financial institutions at close to zero percent interest and provided generous bailouts on favorable terms when all else failed. Regulators turned a blind eye to a lack of transparency and to conflicts of interest." Stiglitz explained that the top 1% got nearly "one-quarter" of the income and own 40% of the wealth. Measured relative to GDP, total compensation and its component wages and salaries have been declining since 1970; this indicates a shift in income from labor to capital. Some five percent of U. S. GDP was $850 billion in 2013; this represents an additional $7,000 in compensation for each of the 120 million U. S. households. Larry Summers estimated in 2007 that the lower 80% of families were receiving $664 billion less income than they would be with a 1979 income distribution, or $7,000 per family.
Not receiving this income may have led many families to increase their debt burden, a significant factor in the 2007–2009 subprime mortgage crisis, as leveraged homeowners suffered a much larger reduction in their net worth during the crisis. Further, since lower income families tend to spend more of their income than higher income families, shifting more of the income to wealthier families may slow economic growth; some large U. S. corporations have used a strategy called tax inversion to change their headquarters to a non-U. S. Country to reduce their tax liability. About 46 companies have reincorporated in low-tax countries since 1982, including 15 since 2012. Six more planned to do so in 2015. One indication of increasing corporate power was the removal of restrictions on their ability to buy back stock, contributing to increased income inequality. Writing in the Harvard Business Review in S