Technological progress and the future of the corporation

Abstract: Drastic and rapid technological changes, driven by the ability to process large data at unprecedented speed and the use of algorithms to make decisions, drastically change the way corporations do business. Disruptive innovation originates from outside of traditional industries, as data are accessible and distribution inexpensive. Giant online platforms gather vast amounts of data from users and control access to them. They invest massively in research, threatening more industries. These rapid changes challenge regulators, especially vis-à-vis technology giants. This chapter outlines the effects of technology on corporate governance, contracting, labour productivity, efficiency, and market transactions. It concludes that drastic changes in the corporate form are not likely, but that there is likely to be much change in how corporations are run.

Keywords: Disruptive technologies, online platforms, corporate form, corporate behaviour.

Article posted to Journal of the British Academy, volume 6,
supplementary issue 1 (Reforming Business for the 21st Century).