The concentration of economic power: 1% = 20%

For almost 40 or more years political economists have been raising the issue of the inherent risks of the concentration of global economic power into a small minority of transnational corporations. What has been lacking however is good quality data which actually shows the  level of interconnectivity and interlocking equity/stock ownership. The recent study released in late 2011 by the Swiss Federal Institute of Technology in Zurich provides the much needed data to quantify the actual concentration. Using the Orbis database of 37 million companies and investors globally, analysis revealed a core of 1,318 transnational companies which controlled 20 percent of the world's operating revenues. Through share ownership of other companies the 1,318 had control over a further 60 per cent of global revenues. Perhaps the most revealing aspect is the revelation of the existence of 147 "super entities" which in effect controlled 40 per cent of the entire economic network.

Of the greatest interest is the fact within the super-entity group, companies associated with the Global Financial Crisis were listed in the top 20 such as Barclays Bank, JP Morgan Chase & Co and The GoldmanSachs Group. In many respects, the study provides the architecture of global economic power but more importantly it illustrates a potential vulnerability created by such a narrow base where an event such as the Global Financial Crisis occurs.