August 8th, 2020

Economics, Bosses, and Interest

An interview with Stephen Marglin

Stephen Marglin is Walter S. Barker Professor Economics at Harvard University, where he has taught since he received tenure in 1968. Somewhat infamous for his post-tenure radicalism, Marglin has published extensively on a wide range of topics over his decades-long career. Among his most cited early works is the two-part "What Do Bosses Do?", which sought to explain hierarchical production as a function of accumulation, not technical efficiency. Divisions of labor between workers, managers, and bosses do not, Marglin argued, serve increases in productivity and material prosperity, but rather the consolidation of wealth and power.

Similarly influential work conducted with Amit Bhaduri contested neoclassical models that view economic growth as a product of technological advancement and increases in the factors of production. Drawing on a Kaleckian framework which sees output as a function of effective demand, their paper distinguishes between "wage-led" and "profit-led" growth regimes. In the former, income redistribution increases employment and productivity, and in the latter it does not.

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