New Books in Economics

John Kay, "The Corporation in the 21st Century: Why (Almost) Everything We Are Told about Business Is Wrong" (Yale UP, 2025)

Apr 9, 2025

John Kay, a distinguished British economist and author, dives into the complex realities of modern business in his latest work. He questions traditional profit-driven narratives and argues for the rising significance of human capital over mere financial assets. The discussion highlights the dramatic shift from long-standing corporate giants to the prevalence of 'hollow corporations.' Kay also addresses the evolution of business leadership, urging a fresh perspective on management and innovation in our fast-paced economy.

55:15

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John Kay

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Quick takeaways

The modern business landscape emphasizes human resources as the main driver of production, shifting from traditional capital ownership models.

A growing focus on short-term shareholder value over long-term stability reveals how contemporary business practices compromise enduring success.

Deep dives

Shifts in Business Dynamics

The modern business landscape has shifted from a model focused on physical capital to one that emphasizes human resources as the driving force of production. Historical examples, such as steel mills and automotive plants, characterized earlier industrial practices, where capitalists owned the means of production. Today, companies like Apple and Amazon prioritize their workforce's capabilities, often sourcing physical assets rather than owning them outright. This evolution highlights the changing definition of what constitutes a business's 'means of production' and marks a departure from traditional ownership models.

Intro

2min

Redefining Business in the 21st Century

15min

Shifting Motivations: The Evolution of Business Leadership

4min

The Decline of Corporate Giants

22min

The Intersection of Religion and Economic Growth in Western Europe

6min

Rethinking Business and Management in Modern Times

3min

John Kay's The Corporation in the 21st Century: Why (Almost) Everything We Are Told about Business Is Wrong (Yale UP, 2025) is an accessible and entertaining reappraisal of what business is for and how it works.

Full of history and written in a compelling narrative style, this book describes a shift in the underlying assumptions of the relationship between capital & labor. Kay describes how and why we have come to "love the product" as we also "hate the producer".

Kay discusses areas of particular change such as the relationship between business & finance, the concept of the "hollow" corporation, what we mean when we say "growth", and the motivations and standards of industry leaders.

Old ideas of owning the means of production are redundant as workers are increasingly the means of production. Capital is now often a disconnected service contracted from a specialized supplier, and businesses are run by professional managers whose main skill is exerting authority.

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