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0:00
Hello. I'm Prof. Anna Grosman,
and I teach at
Loughborough University.
Today, I will talk
about state capitalism,
and I will talk about
corporations as instruments
of state power.
0:15
Today, I want to talk about
political connections
and bailouts.
This lecture is about
corporations benefiting from
their political connections
in times of crisis,
in particular, during
pandemics or financial crisis
and how do they benefit
from government bailouts.
UK companies, in
particular, with
powerful majority owners
or political ties
during the crisis had
higher bailout chances,
leveraging their political
capital for financial support.
Some of my research
that was published in
Environment and Planning
A: Economy and Space
journal highlighted
evidence that
bailout allocations
to different firms
lacked clear criteria,
which led to
government favoring some
firms over the others.
That political favoritism of
politically connected
firms over the others
distorted competition and
also disadvantaged businesses
without political connections.
During the pandemic,
the UK government took
a more proactive role in helping
and financing businesses.
It provided financial assistance
as low-interest
government loans.
It also paid salaries
during lockdown,
while people were not working,
and it also spent money on
just trying to fill
the economic vacuum.
This form of capitalism,
which is known as
state capitalism,
involves governments
assuming the role of an
active economic agent.
That expands the state's
role as a promoter,
supervisor, and
owner of capital,
with a far greater
control over the economy.
