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The mainstream or neoclassical economics view that labor is rewarded according to its productivity has been extended to managers and management teams as justification for the levels of compensation that they receive. Additionally, the management concept of "span of management" or "span of control" has been used to explain the total number of and per employee number of managers in any organization along with the assumption that the appropriate span of management is where the marginal productivity of the last manager employed should equal his/her marginal cost, or wage. Or, at least, this is supposed to be the case in competitive industries in the short run, or in all industries in the long run. On the other hand, heterodox economists hold different views of the roles and purposes of managers within organizations and attempt to explain these through either the view of managers exploiting workers on behalf of owners or the view of managers exploiting both workers and owners in order to advance their own agendas. This article examines managerial compensation and intensity from both traditional/mainstream and alternative views (mostly using David Gordon's theory of a "bureaucratic burden" existing in most U.S. industries). [ABSTRACT FROM AUTHOR]

Joseph Schumpeter's writings on entrepreneurship and innovation have had a profound impact on economic theory and economic thought. Schumpeter initially saw the small entrepreneur as the source of innovation and economic growth within an economic system but later saw large corporations as the source of much innovation. One of his students and friends, Paul M. Sweezy, was influenced by this thinking, and he also emphasized (along with frequent co-author Paul Baran) the role of large corporations in the US and global economies. In today's times, Schumpeter would be impressed with the success of large firms regarding innovation but probably would be disappointed about the marginalization of the small entrepreneurial firm and the traditional banking system and their diminished roles in innovation. Sweezy would have predicted such an outcome as inevitable given trends in capitalist economies. This paper summarizes Schumpeter's and Sweezy's (and Baran and Sweezy's) views on how the banking system and financial markets could play a role in innovation and explains how a modern day monopoly capital system and its financial system have transformed entrepreneurship and innovation away from small business and the small entrepreneur. [ABSTRACT FROM AUTHOR]

This research note performs some limited empirical assessments of the monopoly capital school of thought contention that most research and development (R&D) efforts in the US are 'wasted' at the macroeconomic level in that as R&D succeeds by absorbing a little of the excess economic surplus generated by a capitalist system, it still fails to generate a lot of innovation of a transformative nature. At an aggregate level, greater R&D efforts are correlated with higher worker productivity and standards of living, which is to be expected according to mainstream economic theory and literature. Yet, R&D efforts regarding job creation, new firm creation, and net business investment show either mixed results or even negative connections. There is some preliminary empirical support in this paper for many aspects of the Baran and Sweezy point of view on R&D, and these findings also hint that R&D is used in a monopoly capital system to further monopolization. The findings of this note also may help to explain how productivity gains and innovation over the last few decades may not be benefitting the typical worker or the creation of small businesses as well. [ABSTRACT FROM AUTHOR]

There has been a growing body of literature over the last several years on a possible decline in US entrepreneurship and the reasons for it. US small business formation and the jobs created by small businesses are supposed to be key elements in US economic growth. Many claim that without growth in small businesses and the jobs they provide that the US economy will either not grow at all or only very slowly. Therefore, small business is a key to understanding capitalism in the twenty-first century since under monopoly capital, there is claimed to be a tendency towards economic concentration (at the expense of small business) and towards economic stagnation. Some of the general causes mentioned for less US entrepreneurism include high levels of debt among the US populace and the increasing challenges that small businesses face against larger ones. Another concern is the amount of increasing business regulation and government presence in the US economy with which small businesses struggle more than larger ones. If entrepreneurism requires risk taking, then high levels of household debt and large, well-financed potential competitors may be hindering prospective entrepreneurs. This exploratory paper finds that these factors are highly correlated with the slowdown in the entry rates of new firms into the US economy since the late 1970s as well as with a slowdown in the job creation rate of these firms. [ABSTRACT FROM AUTHOR]