Skip to main content



Global Super-Entity

In a very interesting study, researchers found that a “small, tightly woven network of companies, mostly banks, wields disproportionate control over the global economy”(Boyle 2011). This is very similar to the claim that “Occupy Wall Street” had, which said that the 1% owns the world and that too much power in the hands of the few might cause financial instability, like that seen in 2008.

This research was done by analyzing 43,060 “transnational corporations and studied their share ownerships, searching for commonalities that tie the companies together”(Boyle 2011). What they found was that there was basically two cores, an inner core and an outer core. The outer core consisted of 1,318 companies that all were owned by more than two companies and had an average of 20 connections to other companies. Inside this outer core of companies that were highly connected, there was an inner core of 147 companies that were very tight and in the middle compared to the rest of the core. This section was called an “economic super entity” and held about 40% ownership of all transnational corporations. Even more surprising was that the core of 147 companies was three quarters owned by the core itself. So the core has almost complete control over itself.

The inner core consisted mostly of banks, and although there is no conspiracy theory, in practice this proves that a few people have a very large amount of control over the global economy. This study is very important since it might lead to better policy and new ways of studying complex networks, which is a field bursting with new ideas and frontiers.

Works Cited:

Boyle, Rebecca. “A Tightly Knit Network of Companies Runs the World Economy, Says Network Analysis | Popular Science.” Popular Science | New Technology, Science News, The Future Now. N.p., 20 Oct. 2011. Web. 4 Apr. 2013. <http://www.popsci.com/science/article/2011-10/tightly-knit-network-companies-runs-world-economy-say-swiss-researchers>.

Comments

2 Responses to “ Global Super-Entity ”

  • vlb52

    It is interesting to see how much power is the hands of the few. I wonder if this is decreasing competition, or if there is still enough distrust in between companies to keep tensions high. It could be a situation like the European nobility: lots of marriages, but little cooperation.

  • dwc92@cornell.edu

    Your post seems like a cogent and concise summary of the original article, and it reminds me of an infographic that I saw a while back which basically revealed that most domestic products sold at the usual supermarkets are actually produced by only a small subset of companies (about 7), even though we see many “brand names” at different stores. The “big 7” companies actually produce most of the products while masquerading as different brand names that they actually own. I forget specific names right now, but it’s similar to saying that one company produces 6 different kinds of shampoo, each with a different name. We can only hope that studies like this push lawmakers in the right direction.

Leave a Reply

You must be logged in to post a comment.