As we all know, Marx's powerful and compelling critique of capitalism provided no explicit model for a viable alternative to capitalism, no "recipes for cookshops of the future," in his disdainful phrase.1 Marx shouldn’t be faulted for this omission. He was a "scientific" socialist. Although there were sufficient data available to him to ground his critique of capitalism, there was little upon which to draw regarding alternative economic institutions. No "experiments" had been performed. We no longer have that excuse.

Although researchers have begun to examine how firms manage their entire web of stakeholder relationships, the component relationships also require theoretical and empirical examination. Several studies have found that Employee Stock Ownership Plans (ESOPs) have a positive impact on firm performance. The authors explain these results by hypothesizing that ESOPs, when combined with employee participation programs, forge a stakeholder relationship between management and employees. The authors offer criteria for identifying stakeholder relationships, provide background on ESOPs, analyze why they contribute to (...) establishing such a relationship, and examine how published empirical research supports this analysis. The authors conclude by suggesting directions for future research. (shrink)