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Andrew Bowman - The End of the Experiment? From Competition to the Foundational Economy

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This book describes the failure of a 30 year old policy experiment with competition and markets and proposes a new experiment in social licensing of foundational activities. The repeated failure of that old experiment in subjecting the basics of everyday life to competition is conclusively demonstrated by detailed case studies of three sectors - broadband, food supply and retail banking - where private sector business models realise point value for corporations at the expense of underinvestment, damaged supply chains and gouged customers.
The radical move is then to change the frame and envisage a new experiment. The three sectors are only part of a much larger foundational economy, producing mundane goods and services which form the basis of civilised life. In this sheltered zone, firms and sectors enjoy privileges which bring profit. The book argues for a new experiment in social licensing whereby the right to trade in foundational activities would be dependent on the discharge of social obligations in the form of sourcing, training and living wages.
This argument for reframing economic policy choices comes from a team of researchers and policy advocates based at the Centre for Research on Socio Cultural Change who blog as Manchester Capitalism. Their book combines rigour and readability so that it is relevant to all those - practitioners, policy makers, academics and engaged citizens - who are looking for new possibilities of action which can start a process of learning about a better way of organising the fundamentals of economic life. It offers a way out of the current impasse.

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The end of the experiment?

The Manchester Capitalism book series General Editor MICHAEL MORAN - photo 1

The Manchester Capitalism book series

General Editor

MICHAEL MORAN

Manchester Capitalism is a series of short books which reframe the big issues of economic renewal, financial reform and political mobilisation. The books do so by directly tackling such issues and the underlying conditions of the capitalist imagination in everything from university pedagogy to market bricolage. The underlying economic assumption is that a fundamental reframing of policy choices is necessary before we can reform our capitalism levered on the state, which is in turn levered on debt in all the high income countries. We write in the liberal collectivist tradition of the 1930s about new social techniques to ensure security in a resilient, responsible capitalism. But, we cannot share the faith of Berle or Macmillan in the benevolence and competence of central states, which in the present conjuncture are endlessly repeating experiments in competition and markets without confronting the limits of this framework.

The individual books in our series all combine follow the money research with readable discussion of narrative alibis. This distinctive form of analysis was pioneered, in public interest reports about mundane activities like meat supply and railways, by the multidisciplinary team of researchers working at the Centre for Research on Socio-Cultural Change (cresc.ac.uk) and now blogging at the Manchester Capitalism web site. Present day knowledges are combined with eclectic borrowing from free-thinking earlier critics of capitalism like Wright Mills and Braudel, who deserve better than the neglect of posterity. Our political assumption is that there is much distributed intelligence in our economy and society outside the metropolitan centres of elite decision making. We write to inform and empower that force which the nineteenth century recognised as agenda setting, provincial radicalism, and we promote devolved government with a social purpose for the twenty first century.

The end of the experiment?
From competition to the foundational economy
Andrew Bowman, Ismail Ertrk, Julie Froud, Sukhdev Johal, John Law, Adam Leaver, Michael Moran and Karel Williams

Manchester University Press

Manchester and New York

distributed in the United States exclusively
by PALGRAVE MACMILLAN

Copyright Andrew Bowman, Ismail Ertrk, Julie Froud, Sukhdev Johal, John Law, Adam Leaver, Michael Moran and Karel Williams 2014
The rights of Andrew Bowman, Ismail Ertrk, Julie Froud, Sukhdev Johal, John Law, Adam Leaver, Michael Moran and Karel Williams to be identified as the authors of this work has been asserted by them in accordance with the Copyright, Designs and Patents Act 1988.
Published by Manchester University Press
c/o the Renold Building Oxford Road, Manchester M13 9PL, UK
and Room 400, 175 Fifth Avenue, New York, NY 10010, USA
www.manchesteruniversitypress.co.uk
Distributed in the United States exclusively by
Palgrave Macmillan, 175 Fifth Avenue, New York,
NY 10010, USA
Distributed in Canada exclusively by
UBC Press, University of British Columbia, 2029 West Mall,
Vancouver, BC, Canada V6T 1Z2
British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging-in-Publication Data applied for
ISBN 978 1 8477 9892 3
First published 2014
The publisher has no responsibility for the persistence or accuracy of URLs for any external or third-party internet websites referred to in this book, and does not guarantee that any content on such websites is, or will remain, accurate or appropriate.
Contents
List of exhibits
TalkTalk financial performance and investment, 20102013 (2013 prices)
BT net tangible fixed investment and dividends, 19952013 (2013 prices)
BT Openreach: capital investment, 20062013 (2013 prices), m
BT external revenue by division, 20062013 (2013 prices), m
BT operating profits by division, 20062013 (2013 prices), m
BT operating profit margins by division, 20062013, %
Composition of the UK fixed telecoms market revenues, with average household expenditure on communication services, 20062011
Virgin Media cable customer churn, 20072011
Proportion of broadband customers using bundled services, 20062012 (%)
BT expenditure on Premier League football, compared with final third broadband coverage
Big four supermarket operating profit margins, 19972013 (%)
UK big four supermarkets floor space (000 square feet), 20002013
UK big four annual sales revenue, per square foot of retail floor space, 19972013
UK big four capital expenditure as a % of retail sales revenues, 20002013
Retail and farmgate milk price trends: pence per litre, 20002013 (2013 prices)
Supply chain shares of the retail price of milk (in pence per litre) between the main players, 19962011 (2013 prices)
Price index for key dairy farming inputs compared to indexed milk price, 20032012
UK dairy farm business incomes (average per farm)
Total UK raw milk production (million litres), split by destination (liquid milk and dairy manufacturing), 19872012
UK balance of trade in dairy products, 19902012 in million (nominal values)
Processor market shares (%) in the UK fresh milk sector, 20112012
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