Case Study Of Wall Street: Symbolic Framing Of Corporate America

1390 Words 6 Pages
MIDTERM #2

Question #1

It was the investment bankers of Wall Street who were the original, principal innovators of the symbolic framing of Corporate America in the 1980s. The capitalist realized that it was something wrong with the Corporate America, due to the exogenous system shock in the 80s. The investments bankers symbolically framed the managers because they were “betraying” the owners by using the conglomerate strategy. This strategy has been used since the 1960s to avoid a potential Cellar-Kefauver antitrust regulation. According to Karen Ho, this strategy is the most important reason for why Corporate America was underperforming in the 1970s and 1980s. The total value of the stocks of a company did not longer reflected the companies’
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Corporate raids can be used as an example of a practice that is aimed at producing short-term value. A corporate raid is a process where a person(s) buy a large stake in a firm and can, therefore, vote to make sure that the company will produce short-term share value. These people are only concerned about the shareholder value, to gain a kingdom, not about rational assessment of executive performance. By always wanting short-term profit as fast possible, companies might lose a possible long-term profit, which might have been even greater than the short-term value. An example where practicing short-term value undermines the long-term profitability is General Motors (G.M). The owners had too much focus on short-term profit that it lead them to sell poor cars. The pressure and the desire of making profit as fast as possible made innovation a second prioritize, because they needed time to develop and money could rather be just in financial operations. The biggest failure over the years for G.M, has been that they have not been able to balance between financing car-innovation and investing in financial activities. G.M is therefore struggling today because the owners are only making decisions on what is best in the short run, and do not think about the consequences of this in the long …show more content…
The more education, the higher salary you get. However, Lin & Tomaskovic-Devey (LTD) believe that a more accurate way to determine wages is through a relational strategy. To conceive income inequalities as a result of social relations between actors, in which the interaction is in greater advances for some than others. The determination of wages is an outcome of social relations, it is a function of relevant power; the more power the more leverage, and higher salary. The salaries reflects the relative claims making- and bargaining power of actors in an organization context. Income is an expression of relationship between employer and employees rather than an expression of individual capital/skills. Globalization, technology and financialization are factors that restructured the power of the

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