Economic Democracy: Normative and Practical Challenges

It has often been noted that the liberal democratic model prevalent today in most Western societies is not truly democratic. While the principle of popular sovereignty is usually upheld in the political sphere, the same does not hold for the economic sphere, where many crucial decisions regarding production, investment and resource allocation are left to a minority of powerful economic agents. And this problem is nowhere more palpable than within capitalist enterprises, where most workers have no say on how their work is organized, assessed or remunerated.

In the last decades, the dramatic rise in inequality and corporate global power has led to renewed calls for the democratization of the capitalist production system. Drawing on a long socialist tradition, scholars such as David Schweickart, Richard Wolff and Bruno Jossa have advocated some form of economic or industrial democracy, i.e. the extension of political democracy to the economic realm with the aim of overcoming the existing power gap between corporate shareholders and employees. More recently, these debates have broadened as political theorists like Elizabeth Anderson and Isabelle Ferreras incorporated republican and liberal-egalitarian insights into justifications for workplace democracy. At the same time, renewed attention has been given to earlier thinkers from distinctly non-Marxist traditions, including John Stuart Mill and John Dewey.

Some approaches to economic democracy propose moderate reforms, such as a two-chamber corporate governance model where capital and labour are represented separately. In other, more ambitious variants, economic democracy requires the generalization of worker-directed enterprises, where decisions about production, investment, sales and income distribution are collectively made by the entire workforce. However, some theorists call for a broader transformation of the economic sphere, combining worker self-management with the creation of a national investment fund, the limitation of private ownership or a tighter regulation of international trade. Others push even further, questioning whether markets and democracy are fundamentally compatible or championing participatory forms of democratic planning.

The goal of the present workshop is to rethink economic democracy in all of its dimensions, but we are particularly interested in discussing three aspects that have been at the centre of most recent debates:

a) The normative justification of economic democracy
Most scholars advocate economic democracy as an antidote to capitalism’s harmful social effects, but not all agree on their relative importance: some highlight the need to abolish domination at the workplace, eliminate wage exploitation or reduce inequality, while others focus on capitalism’s inherent instability, its tendency to reduce effective demand or the threat it poses to political democracy.

b) The institutional meaning of economic democracy
Different normative justifications suggest different institutional designs, which reflect different views on the exact scope of economic democracy, its compatibility with the market’s competitive pressures, or the alternative between worker codetermination and some form of social ownership of common productive resources.

c) The transition to economic democracy
The success of economic democracy does not hinge only on its theoretical soundness, but also on its political and economic feasibility. Accordingly, different road maps have been proposed for the institutional transition to a democratic economy, differing on the pace of transformation, on its social and economic costs, on the reforms that must be enacted to ensure its success and on how they accommodate some of the ongoing developments in the economic sphere (e.g. digitalization, artificial intelligence, changes in international trade).