This article explores the implications of the Federal Reserve’s shift to transparency for recent debates about neoliberalism and neoliberal policymaking. I argue that the evolution of US monetary policy represents a specific instance of what I term the “neoliberal dilemma.” In the context of generally deteriorating economic conditions, policymakers are anxious to escape responsibility for economic outcomes, and yet markets require regulation to function in capitalist economies (Polanyi 2001). How policymakers negotiate these contradictory imperatives involves a continual process of institutional (...) innovation in which functions are transferred to markets, but under the close control of the state. Thus, under transparency, Federal Reserve officials discovered innovations in the policy process that enabled “markets to do the Fed’s work for it.” These innovations enlisted market mechanisms, but did not represent a retreat from the state’s active role in managing the economy. (shrink)

ABSTRACT:The notion of “democracy” has become a much-debated concept in scholarship on business ethics, management, and organization studies. The strategy of this paper is to distinguish between a principle of organization that fosters participation and a principle of legitimation that draws on consent. Based on this distinction, we highlight conceptual shortcomings of the literature on stakeholder democracy. We demonstrate that parts of the literature tend to confound ends with means. Many approaches employ type I democracy notions of participation and often (...) take for granted that this also improves type II democratic legitimation. We hold this to be a mistake. We provide examples of the ambiguity of organizational procedures and show that under some circumstances a decrease in the degree of participation may actually increase legitimation because a governance structure that results in higher productivity can provide higher benefits for all parties involved, serve their interests and therefore meet their agreement. Less type I democracy may mean more type II democracy. We believe this to be an important insight for judging the legitimacy of both capitalistic firms and competitive markets. (shrink)