Other People's Money

Other People's Money

Stanford Social Innovation Review. December
2019, Vol. Winter 2020

The debates about our economic system are sometimes framed as a stark choice between market-based capitalism and government-controlled socialism. But the actual choices are much more complicated. Corporations, which control much of our economic activity today, owe their existence to governments. Although they do not vote in elections, the economic and political power of corporations and their impact on democracy are immense. The challenge arises from the tension between functioning democracy on one hand and narrowly defined business practices on the other hand. For the market economy to serve society in a democracy, more citizens must become educated about the forces that shape the system, including corporations and governments, and the key role of effective governance in determining the outcomes.