The MPIfG’s Research Program

One way to look at this development is through the lens of the owners of private wealth. The expanding capital stock is highly concentrated in the hands of a very small group of wealth owners at the top of the distribution. While capitalism is dynamic and instable, ownership of wealth often shows long-term continuities, with wealth being passed on dynastically within families over generations. This raises questions of social mobility and social inequality, topics that stand at the center of much current research in the social sciences. Research at the Institute on this topic will empirically and historically investigate the continuities of large fortunes as well as their ruptures due to external shocks or intrinsic failures. Research will foreground the family, rather than the corporation, as the entity ensuring continuity, not only of nineteenth-century family capitalism but also of today’s asset management capitalism. We will investigate wealth owners rather than their managers as the dominant economic actors in society. Our interest relates to the mechanisms used for the perpetuation of great fortunes, including the employment of legal devices to secure wealth from the state or to curb family conflict, wealth preservation through asset management, inducing economically beneficial legal stipulations through lobbying, or the creation of societal goodwill through philanthropic engagement. How are privileged positions preserved in practice? What causes ruptures in these positions? Research projects will also address the question of how super-wealthy individuals think about society and their position in it, thus contributing to the understanding of the ideational configuration of the economic elite. In terms of social theory, projects will contribute to the understanding of the central features of contemporary societies. While mid-twentieth-century social theory emphasized the pluralistic character of democratic capitalism, the shifts in wealth and power distribution over recent decades led to the surfacing of notions like re-feudalization or oligarchic capitalism, notions that indicate a profound shift but seem to be hampered by their terminological reliance on former social formations.


Another area of research the Institute intends to strengthen is the study of social transformations brought about by technological change. This area will be an additional pillar of investigating the instability of capitalism, since disruption through technological development is a chief source of this instability. New digital technologies change the distribution of labor market risks. This trend will affect preferences for social programs, taxation, redistribution, and partisan choice. Technological change and the enhancement of the ability to monitor work performance ever more precisely may turn labor markets into markets for labor services, which, in the absence of regulatory change, may have enormous consequences for worker protection and economic inequality.

In the sphere of politics and democracy, technological change generates contrasting expectations about future developments. On the one hand, digital technology removes the “scale” constraint, making direct democracy a concrete possibility. On the other, digitalization enables governments (including foreign ones) and special interest groups to manipulate the democratic process, thus potentially destabilizing the political order. It is crucial to understand how these contradictory trends shape the evolution of democracy.

Another implication of new digital technologies is a complete loss of privacy, with data-collecting companies and the state being able to observe the behavior of citizens in great detail. Technologies for predicting future behavior allow for new levels of consumer manipulation, but also for predictive policing and the tailoring of credit decisions and insurance contracts to ever more refined scoring systems. As existing research shows, this can easily lead to new forms of inequality and discrimination. In addition, digital platforms like Facebook, YouTube, or dating sites profoundly shape the structure of social interactions in society. Finally, urban landscapes too may shift dramatically with the development of the “smart city,” a city in which every interaction with the social and physical environment is a source of data that can be recorded and stored. This allows for more efficient coordination, but it also offers ample opportunities for surveillance and nudging, with negative consequences for individual freedom and privacy.

The role of technological change for social dynamics is to some extent already reflected in research at the Institute. New technologies develop from expectations, i. e., projections, of technological trajectories. Such processes are currently investigated in projects that are informed by a science and technology perspective. From a political economy viewpoint, new technologies affect the organization of production, the distribution of risks, and the level and composition of aggregate demand.

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