Taking Corporate Power Seriously: Beyond the FirmState Analogy

The firm-state analogy plays a central role in theorizing corporate power in the literature on workplace democracy and political theories of the business corporation. This article presents three different readings of the firm-state analogy that are commonly found in the literature, namely, (a) heuristic, (b) justificatory, and (c) epistemic. The heuristic function is to draw political theorists’ attention to the important role of business firms in democratic society. The justificatory function is to lay the ground for a justification of the democratization of the business firm. The epistemic function is to depict an epistemically more accurate picture of the power that business firms exercise. The article argues that: (a) the heuristic function has completed its historical mission; (b) the justificatory function has limited utilities and is normatively redundant; and (c) the epistemic function leads to a misleading picture of the power of (especially multinational) business corporations. In other words, in order to better understand the power of the business corporation, we need to move beyond the firm-state analogy.