Mergers and Managerialism

Abstract

Having examined the link between monopolisation and the share of profits in the economy, we now turn to examine the process of monopolisation itself and its apparent impact within a managerial world. It is clear that the post-war period, and especially the late 1960s and early 1970s, have been characterised by a dramatic change in the structure of the capitalist sector of the economy. This has come about via large-scale merger activity, which in Europe at least has been principally horizontal in character — that is, it involved the joining together of corporations to form new giants which dominated specific industries or sectors of the economy (see Aaronovitch and Sawyer, 1975; Hannah and Kay, 1977; Prais, 1976). The situation in the USA was somewhat different since the anti-trust laws largely prohibited horizontal mergers. Merger activity was still commonplace, however, and new giant corporations were formed; these were generally conglomerate in character, although the dominance of these giants in any one market is partly determined by their very size — whether in that specific market or beyond.