Performing Agency Theory and the Neoliberalization of the State

Tim Christiaens*

*Corresponding author for this work

Research output: Contribution to journalArticleScientificpeer-review

Abstract

According to Streeck and Vogl, the neoliberalization of the state has been the result of political-economic developments that render the state dependent on financial markets. However, they do not explain the discursive shifts that would have been required for demoting the state to the role of an agent to bondholders. I propose to explain this shift via the performative effect of neoliberal agency theory. In 1976, Michael Jensen and William Meckling claimed that corporate managers are agents to shareholding principals, which implied that their main task was the procurement of shareholder value. Agency theory subsequently prescribes a series of measures to ensure the alignment of principal and agent interests in corporations. The diffusion of agency theory, however, moved beyond corporate governance to reconfigure the state. Due to its reliance on capital markets, the state supposedly likewise becomes an agent of the investment public and should procure bondholder value.

Original languageEnglish
Pages (from-to)393-411
Number of pages19
JournalCritical sociology
Volume46
Issue number3
DOIs
Publication statusPublished - May 2020
Externally publishedYes

Keywords

  • agency theory
  • corporations
  • critical theory
  • financial power
  • neoliberalism
  • performativity
  • state theory
  • MAXIMIZING SHAREHOLDER VALUE
  • REVOLVING-DOOR
  • CORPORATE GOVERNANCE
  • PRESSURE GROUPS
  • MARKET
  • CONSTRUCTION
  • OWNERSHIP
  • DIFFUSION
  • IDEOLOGY
  • SUICIDE

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