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The Network of Global Corporate Control
Abstract
object_of_studycontributionconcepts↗concepts↗concepts↗concepts↗concepts↗claim_relationsconcept_edgesconcept_edgescontent_tagsThe structure of the control network of transnational corporations affects global market competition and financial stability. So far, only small national samples were studied and there was no appropriate methodology to assess control globally. We present the first investigation of the architecture of the international ownership network, along with the computation of the control held by each global player. We find that transnational corporations form a giant bow-tie structure and that a large portion of control flows to a small tightly-knit core of financial institutions. This core can be seen as an economic “super-entity” that raises new important issues both for researchers and policy makers.
Introduction
research_questionphenomenonlimitationsconcepts↗A common intuition among scholars and in the media sees the global economy as being dominated by a handful of powerful transnational corporations (TNCs). However, this has not been confirmed or rejected with explicit numbers. A quantitative investigation is not a trivial task because firms may exert control over other firms via a web of direct and indirect ownership relations which extends over many countries. Therefore, a complex network analysis [1] is needed in order to uncover the structure of control and its implications. Recently, economic networks have attracted growing attention [2] , e.g., networks of trade [3] , products [4] , credit [5] , [6] , stock prices [7] and boards of directors [8] , [9] . This literature has also analyzed ownership networks [10] , [11] , but has neglected the structure of control at a global level. Even the corporate governance literature has only studied small national business groups [12] . Certainly, it is intuitive that every large corporation has a pyramid of subsidiaries below and a number of shareholders above. However, economic theory does not offer models that predict how TNCs globally connect to each other. Three alternative hypotheses can be formulated. TNCs may remain isolated, cluster in separated coalitions, or form a giant connected component, possibly with a core-periphery structure. So far, this issue has remained unaddressed, notwithstanding its important implications for policy making. Indeed, mutual ownership relations among firms within the same sector can, in some cases, jeopardize market competition [13] , [14] . Moreover, linkages among financial institutions have been recognized to have ambiguous effects on their financial fragility [15] , [16] . Verifying to what extent these implications hold true in the global economy is per se an unexplored field of research and is beyond the scope of this article. However, a necessary precondition to such investigations is to uncover the worldwide structure of corporate control. This was never performed before and it is the aim of the present work.
Methods
method↗mechanisms↗mechanisms↗concepts↗concepts↗unhoused_relationssensescontent_tags↗content_tags↗Ownership refers to a person or a firm owning another firm entirely or partially. Let denote the ownership matrix, where the component is the percentage of ownership that the owner (or shareholder ) holds in firm . This corresponds to a directed weighted graph with firms represented as nodes and ownership ties as links. If, in turn, firm owns shares of firm , then firm has an indirect ownership of firm ( Figure 1 A ). In the simplest case, this amounts trivially to the product of the shares of direct ownership . If we now consider the economic value of firms (e.g., operating revenue in USD), an amount is associated to in the direct case, and in the indirect case. This computation can be extended to a generic graph, with some important caveats [17] , Appendix S1 , Sections 3.1 and 3.2
Ownership and Control. ( A&B ) Direct and indirect ownership. (A) Firm has percent of direct ownership in firm . Through , it has also an indirect ownership in and . (B) With cycles one has to take into account the recursive paths, see Appendix S1 , Section 3.1. ( C&D ) Threshold model. (C) Percentages of ownership are indicated along the links. (D) If a shareholder has ownership exceeding a threshold (e.g. ), it has full control (100%) and the others have none (0%). More conservative model of control are also considered see Appendix S1 , Section 3.1.
mechanisms↗mechanisms↗controlsconcepts↗concepts↗concepts↗concepts↗unhoused_relationssensessensescontent_tags↗content_tags↗content_tags↗Each shareholder has the right to a fraction of the firm revenue (dividend) and to a voice in the decision making process (e.g., voting rights at the shareholder meetings). Thus the larger the ownership share in a firm, the larger is the associated control over it, denoted as . Intuitively, control corresponds to the chances of seeing one's own interest prevailing in the business strategy of the firm. Control is usually computed from ownership with a simple threshold rule: the majority shareholder has full control. In the example of Figure 1 C, D , this yields in the direct case and in the indirect case. As a robustness check, we tested also more conservative models where minorities keep some control (see Appendix S1 , Section 3.1). In analogy to ownership, the extension to a generic graph is the notion of network control : . This sums up the value controlled by through its shares in , plus the value controlled indirectly via the network control of . Thus, network control has the meaning of the total amount of economic value over which has an influence (e.g. in Figure 1 D ).
claim_typemechanisms↗limitationsconcepts↗concepts↗concepts↗concepts↗concepts↗concepts↗unhoused_relationsunhoused_relationsclaim_relationsconcept_edgesBecause of indirect links, control flows upstream from many firms and can result in some shareholders becoming very powerful. However, especially in graphs with many cycles (see Figures 1 B and S4 in Appendix S1 ), the computation of , in the basic formulation detailed above, severely overestimates the control assigned to actors in two cases: firms that are part of cycles (or cross-shareholding structures), and shareholders that are upstream of these structures. An illustration of the problem on a simple network example, together with the details of the method are provided in Appendix S1 , Sections 3.2–3.4. A partial solution for small networks was provided in [18] . Previous work on large control networks used a different network construction method and neglected this issue entirely [11] , Appendix S1 , Sections 2 and 3.5. In this paper, by building on [11] , we develop a new methodology to overcome the problem of control overestimation, which can be employed to compute control in large networks.
Results
mechanisms↗concepts↗content_tagscontent_tagscontent_tagscontent_tagscontent_tagsWe start from a list of 43060 TNCs identified according to the OECD definition, taken from a sample of about 30 million economic actors contained in the Orbis 2007 database (see Appendix S1 , Section 2). We then apply a recursive search (Figure S1 and Section 2 in Appendix S1 ) which singles out, for the first time to our knowledge, the network of all the ownership pathways originating from and pointing to TNCs (Figure S2 in Appendix S1 ). The resulting TNC network includes 600508 nodes and 1006987 ownership ties.
limitationsconcepts↗concept_edgesNotice that this data set fundamentally differs from the ones analyzed in [11] (which considered only listed companies in separate countries and their direct shareholders). Here we are interested in the true global ownership network and many TNCs are not listed companies (see also Appendix S1 , Section 2).
Network Topology
concepts↗concepts↗concepts↗concepts↗concepts↗concepts↗unhoused_relationssensessensesconcept_edgesconcept_edgesconcept_edgescontent_tagscontent_tagscontent_tagscontent_tags↗content_tags↗content_tagscontent_tagscontent_tagsThe computation of control requires a prior analysis of the topology. In terms of connectivity, the network consists of many small connected components, but the largest one (3/4 of all nodes) contains all the top TNCs by economic value, accounting for 94.2% of the total TNC operating revenue ( Table 1 ). Besides the usual network statistics (Figures S5 and S6 in Appendix S1 ), two topological properties are the most relevant to the focus of this work. The first is the abundance of cycles of length two (mutual cross-shareholdings) or greater (Figure S7 and Section 7 in Appendix S1 ), which are well studied motifs in corporate governance [19] . A generalization is a strongly connected component (SCC), i.e., a set of firms in which every member owns directly and/or indirectly shares in every other member. This kind of structures, so far observed only in small samples, has explanations such as anti-takeover strategies, reduction of transaction costs, risk sharing, increasing trust and groups of interest [20] . No matter its origin, however, it weakens market competition [13] , [14] . The second characteristics is that the largest connect component contains only one dominant strongly connected component (1347 nodes). Thus, similar to the WWW, the TNC network has a bow-tie structure [21] (see Figure 2 A and Appendix S1 , Section 6). Its peculiarity is that the strongly connected component, or core , is very small compared to the other sections of the bow-tie, and that the out-section is significantly larger than the in-section and the tubes and tendrils ( Figure 2 B and Table 1 ). The core is also very densely connected, with members having, on average, ties to 20 other members ( Figure 2 C, D ). As a result, about 3/4 of the ownership of firms in the core remains in the hands of firms of the core itself. In other words, this is a tightly-knit group of corporations that cumulatively hold the majority share of each other.
concepts↗concept_edgescontent_tags↗Network topology. ( A ) A bow-tie consists of in-section (IN), out-section (OUT), strongly connected component or core (SCC), and tubes and tendrils (T&T). ( B ) Bow-tie structure of the largest connected component (LCC) and other connected components (OCC). Each section volume scales logarithmically with the share of its TNCs operating revenue. In parenthesis, percentage of operating revenue and number of TNCs, cfr. Table 1 . ( C ) SCC layout of the SCC (1318 nodes and 12191 links). Node size scales logarithmically with operation revenue, node color with network control (from yellow to red). Link color scales with weight. ( D ) Zoom on some major TNCs in the financial sector. Some cycles are highlighted.
Bow-tie statistics.
Notice that the cross-country analysis of [11] found that only a few of the national ownership networks are bow-ties, and, importantly, for the Anglo-Saxon countries, the main strongly connected components are big compared to the network size.
Concentration of Control
content_tags↗content_tags↗The topological analysis carried out so far does not consider the diverse economic value of firms. We thus compute the network control that economic actors (including TNCs) gain over the TNCs' value (operating revenue) and we address the question of how much this control is concentrated and who are the top control holders. See Figure S3 in Appendix S1 for the distribution of control and operating revenue.
mechanisms↗concepts↗sensesconcept_edgescontent_tagscontent_tags↗content_tags↗It should be noticed that, although scholars have long measured the concentration of wealth and income [22] , there is no prior quantitative estimation for control. Constructing a Lorenz-like curve ( Figure 3 ) allows one to identify the fraction of top holders holding cumulatively of the total network control. Thus, the smaller this fraction, the higher the concentration. In principle, one could expect inequality of control to be comparable to inequality of income across households and firms, since shares of most corporations are publicly accessible in stock markets. In contrast, we find that only top holders accumulate of the control over the value of all TNCs (see also the list of the top holders in Table S1 of Appendix S1 ). The corresponding level of concentration is , to be compared with for operating revenue. Other sensible comparisons include: income distribution in developed countries with [22] and corporate revenue in Fortune1000 ( in 2009). This means that network control is much more unequally distributed than wealth. In particular, the top ranked actors hold a control ten times bigger than what could be expected based on their wealth. The results are robust with respect to the models used to estimate control, see Figure 3 and Tables S2 and S3 in Appendix S1 .
Concentration of network control and operating revenue. Economic actors (TNCs and shareholders) are sorted by descending importance, as given by . A data point located at ( ) corresponds to a fraction of top economic actors cumulatively holding the fraction of network control, value or operating revenue. The different curves refer to network control computed with three models (LM, TM, RM), see Appendix S1 , Section 3.1, and operating revenue. The horizontal line denotes a value of equal to . The level of concentration is determined by the value of the intersection between each curve and the horizontal line. The scale is semi-log.
Discussion
mechanisms↗concepts↗concepts↗concepts↗unhoused_relationscontent_tagscontent_tagscontent_tags↗content_tags↗The fact that control is highly concentrated in the hands of few top holders does not determine if and how they are interconnected. It is only by combining topology with control ranking that we obtain a full characterization of the structure of control. A first question we are now able to answer is where the top actors are located in the bow-tie. As the reader may by now suspect, powerful actors tend to belong to the core. In fact, the location of a TNC in the network does matter. For instance, a randomly chosen TNC in the core has about chance of also being among the top holders, compared to, e.g., for the in-section (Table S4 in Appendix S1 ). A second question concerns what share of total control each component of the bow-tie holds. We find that, despite its small size, the core holds collectively a large fraction of the total network control. In detail, nearly of the control over the economic value of TNCs in the world is held, via a complicated web of ownership relations, by a group of TNCs in the core, which has almost full control over itself. The top holders within the core can thus be thought of as an economic “super-entity” in the global network of corporations. A relevant additional fact at this point is that of the core are financial intermediaries. Figure 2 D shows a small subset of well-known financial players and their links, providing an idea of the level of entanglement of the entire core.
limitationslimitationsconcepts↗concepts↗unhoused_relationsunhoused_relationscontent_tagsThis remarkable finding raises at least two questions that are fundamental to the understanding of the functioning of the global economy. Firstly, what are the implication for global financial stability? It is known that financial institutions establish financial contracts, such as lending or credit derivatives, with several other institutions. This allows them to diversify risk, but, at the same time, it also exposes them to contagion [15] . Unfortunately, information on these contracts is usually not disclosed due to strategic reasons. However, in various countries, the existence of such financial ties is correlated with the existence of ownership relations [23] . Thus, in the hypothesis that the structure of the ownership network is a good proxy for that of the financial network, this implies that the global financial network is also very intricate. Recent works have shown that when a financial network is very densely connected it is prone to systemic risk [16] , [24] . Indeed, while in good times the network is seemingly robust, in bad times firms go into distress simultaneously. This knife-edge property [25] , [26] was witnessed during the recent financial turmoil.
limitationsconcepts↗concepts↗concepts↗unhoused_relationsunhoused_relationssensescontent_tagsSecondly, what are the implications for market competition? Since many TNCs in the core have overlapping domains of activity, the fact that they are connected by ownership relations could facilitate the formation of blocs, which would hamper market competition [14] . Remarkably, the existence of such a core in the global market was never documented before and thus, so far, no scientific study demonstrates or excludes that this international “super-entity” has ever acted as a bloc. However, some examples suggest that this is not an unlikely scenario. For instance, previous studies have shown how even small cross-shareholding structures, at a national level, can affect market competition in sectors such as airline, automobile and steel, as well as the financial one [13] , [14] . At the same time, antitrust institutions around the world (e.g., the UK Office of Fair Trade) closely monitor complex ownership structures within their national borders. The fact that international data sets as well as methods to handle large networks became available only very recently, may explain how this finding could go unnoticed for so long.
limitationslimitationscontrolsconcepts↗content_tagscontent_tags↗Two issues are worth being addressed here. One may question the idea of putting together data of ownership across countries with diverse legal settings. However, previous empirical work shows that of all possible determinants affecting ownership relations in different countries (e.g., tax rules, level of corruption, institutional settings, etc.), only the level of investor protection is statistically relevant [27] . In any case, it is remarkable that our results on concentration are robust with respect to three very different models used to infer control from ownership. The second issue concerns the control that financial institutions effectively exert. According to some theoretical arguments, in general, financial institutions do not invest in equity shares in order to exert control. However, there is also empirical evidence of the opposite [23] , Appendix S1 , Section 8.1. Our results show that, globally, top holders are at least in the position to exert considerable control, either formally (e.g., voting in shareholder and board meetings) or via informal negotiations.
limitationsconcepts↗concepts↗unhoused_relationssensesclaim_relationscontent_tagsBeyond the relevance of these results for economics and policy making, our methodology can be applied to identify key nodes in any real-world network in which a scalar quantity (e.g., resources or energy) flows along directed weighted links. From an empirical point of view, a bow-tie structure with a very small and influential core is a new observation in the study of complex networks. We conjecture that it may be present in other types of networks where “rich-get-richer” mechanisms are at work (although a degree preferential-attachment [1] alone does not produce a bow-tie). However, the fact that the core is so densely connected could be seen as a generalization of the “rich-club phenomenon” with control in the role of degree [3] , [28] , Appendix S1 , Section 8.2. These related open issues could be possibly understood by introducing control in a “fitness model” [29] of network evolution.
Supporting Information
Supporting material: Acronyms and abbreviations, Data and TNC Network Detection, Network Control, Degree and Strength Distribution Analysis, Connected Components Analysis, Bow-Tie Component Size, Strongly Connected Component Analysis, Network Control Concentration, Additional Tables.
(PDF)
Click here for additional data file.
Relations on this page carry a quotation for the claim. Where a relation was separately evidenced — and so tested against the vocabulary for its type — the row says so; 9 of 9 relations here carry that mark. The rest are the tagger’s reading of the sentence quoted beside them.
| facet | tag | field | conf. | whose words |
|---|---|---|---|---|
| object_of_study | the worldwide network of direct and indirect ownership and control among transnational corporations | object_of_study | the paper's words | |
| research_question | whether transnational corporations are isolated, form separate coalitions, or form a globally connected core-periphery structure and how control is concentrated | research_question | the paper's words | |
| contribution | the first global ownership-network investigation, a method correcting control overestimation in large cyclic networks, and a topology-plus-control characterization | contribution | the paper's words | |
| claim_type | method | claim_type | the paper's words | |
| phenomenon | concentration of corporate control, ownership-network topology, competition, and financial fragility | phenomenon | the paper's words | |
| method | network-analysis also in: network-analysis | method | the paper's words | |
| mechanisms | Firms become nodes and percentage ownership becomes directed weighted links. also in: directed weighted graph | mechanisms[0] | 0.95 | the tagger's words |
| mechanisms | Products and recursive paths propagate economic value beyond direct holdings. also in: indirect ownership paths | mechanisms[1] | 0.95 | the tagger's words |
| mechanisms | A majority shareholder receives full control while others receive none. also in: threshold rule | mechanisms[2] | 0.95 | the tagger's words |
| mechanisms | Directly controlled value is added to value influenced recursively through the network. also in: network control | mechanisms[3] | 0.95 | the tagger's words |
| mechanisms | The new method prevents recursive cross-shareholding paths from counting control repeatedly. also in: cycle correction | mechanisms[4] | 0.95 | the tagger's words |
| mechanisms | A search discovers all ownership paths originating from or pointing to TNCs. also in: recursive search | mechanisms[5] | 0.95 | the tagger's words |
| mechanisms | Sorting holders and cumulating control measures how small a fraction holds a chosen total share. also in: Lorenz-like curve | mechanisms[6] | 0.95 | the tagger's words |
| mechanisms | Combining component location with influence identifies where powerful actors reside. also in: topology plus control ranking | mechanisms[7] | 0.95 | the tagger's words |
| limitations | The analysis does not test the consequences of global control structure for competition or financial fragility. | limitations[0] | 0.95 | the tagger's words |
| limitations | Basic recursive network-control formulas severely overestimate actors inside or upstream of cycles. | limitations[1] | 0.95 | the tagger's words |
| limitations | Earlier ownership data covered listed companies in separate countries rather than the true global network. | limitations[2] | 0.95 | the tagger's words |
| limitations | Missing disclosure of financial contracts prevents direct reconstruction of the global financial network. | limitations[3] | 0.95 | the tagger's words |
| limitations | Ownership structure is only hypothesized to proxy financial-network structure. | limitations[4] | 0.95 | the tagger's words |
| limitations | The study neither demonstrates nor excludes coordinated bloc behavior by the corporate core. | limitations[5] | 0.95 | the tagger's words |
| limitations | Pooling ownership across countries may obscure differences in legal and institutional settings. | limitations[6] | 0.95 | the tagger's words |
| limitations | Financial institutions may hold equity without intending to exercise control, and evidence is mixed. | limitations[7] | 0.95 | the tagger's words |
| limitations | The appearance of similar bow-ties in other networks and the proposed rich-club interpretation remain conjectures. | limitations[8] | 0.95 | the tagger's words |
| controls | three control-estimation models eliminates: dependence of concentration on one ownership-to-control model · outcome: held | controls[0] | 0.95 | the tagger's words |
| controls | more conservative control models eliminates: dependence on assigning all control to the majority shareholder · outcome: held | controls[1] | 0.95 | the tagger's words |
| concepts | structure of the control network also in: structure of the control network | concepts[0] | 0.95 | the paper's words |
| concepts | global market competition also in: global market competition | concepts[1] | 0.95 | the paper's words |
| concepts | financial stability also in: financial stability | concepts[2] | 0.95 | the paper's words |
| concepts | transnational corporations also in: transnational corporations | concepts[3] | 0.95 | the paper's words |
| concepts | ownership network also in: ownership network | concepts[4] | 0.95 | the paper's words |
| concepts | Ownership also in: Ownership | concepts[5] | 0.95 | the paper's words |
| concepts | directed weighted graph also in: directed weighted graph | concepts[6] | 0.95 | the paper's words |
| concepts | ownership share also in: ownership share | concepts[7] | 0.95 | the paper's words |
| concepts | control also in: control | concepts[8] | 0.95 | the paper's words |
| concepts | threshold rule also in: threshold rule | concepts[9] | 0.95 | the paper's words |
| concepts | network control also in: network control | concepts[10] | 0.95 | the paper's words |
| concepts | indirect links also in: indirect links | concepts[11] | 0.95 | the paper's words |
| concepts | shareholders becoming very powerful also in: shareholders becoming very powerful | concepts[12] | 0.95 | the paper's words |
| concepts | cycles also in: cycles | concepts[13] | 0.95 | the paper's words |
| concepts | control overestimation also in: control overestimation | concepts[14] | 0.95 | the paper's words |
| concepts | new methodology also in: new methodology | concepts[15] | 0.95 | the paper's words |
| concepts | TNC network also in: TNC network | concepts[16] | 0.95 | the paper's words |
| concepts | listed companies in separate countries and their direct shareholders | concepts[17] | 0.95 | the paper's words |
| concepts | largest connect component also in: largest connect component | concepts[18] | 0.95 | the paper's words |
| concepts | strongly connected component also in: strongly connected component | concepts[19] | 0.95 | the paper's words |
| concepts | core also in: core | concepts[20] | 0.95 | the paper's words |
| concepts | tightly-knit group of corporations also in: tightly-knit group of corporations | concepts[21] | 0.95 | the paper's words |
| concepts | bow-tie also in: bow-tie | concepts[22] | 0.95 | the paper's words |
| concepts | out-section also in: out-section | concepts[23] | 0.95 | the paper's words |
| concepts | in-section also in: in-section | concepts[24] | 0.95 | the paper's words |
| concepts | wealth also in: wealth | concepts[25] | 0.95 | the paper's words |
| concepts | top holders also in: top holders | concepts[26] | 0.95 | the paper's words |
| concepts | super-entity also in: super-entity | concepts[27] | 0.95 | the paper's words |
| concepts | financial intermediaries also in: financial intermediaries | concepts[28] | 0.95 | the paper's words |
| concepts | financial network also in: financial network | concepts[29] | 0.95 | the paper's words |
| concepts | systemic risk also in: systemic risk | concepts[30] | 0.95 | the paper's words |
| concepts | ownership relations also in: ownership relations | concepts[31] | 0.95 | the paper's words |
| concepts | blocs also in: blocs | concepts[32] | 0.95 | the paper's words |
| concepts | market competition also in: market competition | concepts[33] | 0.95 | the paper's words |
| concepts | investor protection also in: investor protection | concepts[34] | 0.95 | the paper's words |
| concepts | scalar quantity also in: scalar quantity | concepts[35] | 0.95 | the paper's words |
| concepts | rich-club phenomenon also in: rich-club phenomenon | concepts[36] | 0.95 | the paper's words |
| concepts | small national samples also in: small national samples | concepts[37] | 0.95 | the paper's words |
| concepts | Previous work on large control networks | concepts[38] | 0.95 | the paper's words |
| unhoused_relations | Ownership → directed weighted graph Ownership corresponds to a directed weighted graph of firms and ties. | unhoused_relations[0] | 0.95 | the tagger's words |
| unhoused_relations | ownership share → control Larger ownership shares are associated with larger control. | unhoused_relations[1] | 0.95 | the tagger's words |
| unhoused_relations | cycles → control overestimation Cycles and upstream positions cause the basic computation to overestimate control. | unhoused_relations[2] | 0.95 | the tagger's words |
| unhoused_relations | new methodology → control overestimation The new method overcomes control overestimation in large networks. | unhoused_relations[3] | 0.95 | the tagger's words |
| unhoused_relations | TNC network → bow-tie The global TNC network has a bow-tie structure. | unhoused_relations[4] | 0.95 | the tagger's words |
| unhoused_relations | core → super-entity Top core holders can be thought of as an economic super-entity. | unhoused_relations[5] | 0.95 | the tagger's words |
| unhoused_relations | ownership relations → financial network Ownership relations are used conditionally as a proxy for undisclosed financial ties. | unhoused_relations[6] | 0.95 | the tagger's words |
| unhoused_relations | financial network → systemic risk A very densely connected financial network is prone to systemic risk. | unhoused_relations[7] | 0.95 | the tagger's words |
| unhoused_relations | ownership relations → blocs Ownership connections could facilitate the formation of blocs. | unhoused_relations[8] | 0.95 | the tagger's words |
| unhoused_relations | blocs → market competition Potential blocs would hamper market competition. | unhoused_relations[9] | 0.95 | the tagger's words |
| unhoused_relations | core → rich-club phenomenon The dense control core could be a generalization of the rich-club phenomenon. | unhoused_relations[10] | 0.95 | the tagger's words |
| senses | ownership as a directed weighted relation rather than mere affiliation | senses[0] | 0.95 | the tagger's words |
| senses | control as influence over strategy rather than legal ownership alone | senses[1] | 0.95 | the tagger's words |
| senses | network control as economic value influenced through all ownership paths | senses[2] | 0.95 | the tagger's words |
| senses | core as the one dominant strongly connected component | senses[3] | 0.95 | the tagger's words |
| senses | bow-tie as asymmetric global corporate topology | senses[4] | 0.95 | the tagger's words |
| senses | concentration as cumulative control held by a small top fraction | senses[5] | 0.95 | the tagger's words |
| senses | super-entity as an analytical description, not demonstrated coordinated action | senses[6] | 0.95 | the tagger's words |
| senses | general method as scalar flow over directed weighted real-world networks | senses[7] | 0.95 | the tagger's words |
| claim_relations | builds-on → Previous work on large control networks note: The method explicitly builds on prior work while correcting its cycle problem. | claim_relations[0] | 0.95 | the tagger's words |
| claim_relations | contrasts-with → small national samples note: The global analysis addresses the limited scope of prior studies. | claim_relations[1] | 0.95 | the tagger's words |
| claim_relations | extends → rich-club phenomenon note: The authors conjecture that the dense control core generalizes a rich club. | claim_relations[2] | 0.95 | the tagger's words |
| concept_edges | structure of the control network —causes→ global market competition the relation itself is separately evidenced · strength of the relation: 0.85 · note: Flat but sign-unspecified effect claim. · the relation stated: The control-network structure affects global market competition. | concept_edges[0] | 0.95 | the tagger's words |
| concept_edges | structure of the control network —causes→ financial stability the relation itself is separately evidenced · strength of the relation: 0.85 · note: Flat but sign-unspecified effect claim. · the relation stated: The control-network structure affects financial stability. | concept_edges[1] | 0.95 | the tagger's words |
| concept_edges | indirect links —causes→ shareholders becoming very powerful direction on the measure: increases · the relation itself is separately evidenced · strength of the relation: 0.7 · note: Modal can-result statement. · the relation stated: Indirect links can result in shareholders becoming very powerful.
Audit 2026-09-28: DOUBTFUL - read against its full span and kept, but the span says indirect links CAN result in some shareholders becoming very powerful; hedged. | concept_edges[2] | 0.95 | the tagger's words |
| concept_edges | TNC network —distinct-from→ listed companies in separate countries and their direct shareholders the relation itself is separately evidenced · strength of the relation: 0.95 · note: Explicit difference in coverage. · the relation stated: The global TNC data fundamentally differs from prior country-listed-company data.
Audit 2026-09-28: DOUBTFUL - read against its full span and kept, but endpoint by anaphora: 'this data set' = the TNC network (previous sentence). | concept_edges[3] | 0.95 | the tagger's words |
| concept_edges | strongly connected component —part-of→ largest connect component the relation itself is separately evidenced · strength of the relation: 1 · note: Explicit container-first containment; endpoint spelling follows the staged source. · the relation stated: The largest connected component contains one dominant strongly connected component. | concept_edges[4] | 0.95 | the tagger's words |
| concept_edges | core —is-a→ tightly-knit group of corporations the relation itself is separately evidenced · strength of the relation: 1 · note: Direct categorical restatement. · the relation stated: The core is a tightly-knit group of corporations holding one another's shares. also in: core · tightly-knit group of corporations | concept_edges[5] | 0.95 | the tagger's words |
| concept_edges | core —part-of→ bow-tie the relation itself is separately evidenced · strength of the relation: 1 · note: Explicit container-first containment. · the relation stated: A bow-tie consists of a strongly connected core plus IN, OUT, tubes, and tendrils. | concept_edges[6] | 0.95 | the tagger's words |
| concept_edges | out-section —contrasted-with→ in-section the relation itself is separately evidenced · strength of the relation: 0.95 · note: Direct size comparison. · the relation stated: The out-section is significantly larger than the in-section. also in: out-section · in-section | concept_edges[7] | 0.95 | the tagger's words |
| concept_edges | network control —contrasted-with→ wealth the relation itself is separately evidenced · strength of the relation: 0.95 · note: Direct inequality comparison. · the relation stated: Network control is much more unequally distributed than wealth. also in: network control · wealth | concept_edges[8] | 0.95 | the tagger's words |
| content_tags | Transnational corporations form a giant bow-tie and much control flows to a small tightly knit financial core. | content_tags.findings[0] | 0.95 | the tagger's words |
| content_tags | The global ownership network contains 600,508 nodes and 1,006,987 ownership ties. | content_tags.findings[1] | 0.95 | the tagger's words |
| content_tags | The largest connected component contains three quarters of nodes and 94.2 percent of TNC operating revenue. | content_tags.findings[2] | 0.95 | the tagger's words |
| content_tags | The network contains one dominant strongly connected component of 1,347 nodes. | content_tags.findings[3] | 0.95 | the tagger's words |
| content_tags | The core is small, dense, and internally retains about three quarters of its firms' ownership. | content_tags.findings[4] | 0.95 | the tagger's words |
| content_tags | Network control is substantially more unequal than wealth and top actors control far more than their wealth predicts. | content_tags.findings[5] | 0.95 | the tagger's words |
| content_tags | Combining topology with control rankings shows that powerful actors tend to occupy the core. | content_tags.findings[6] | 0.95 | the tagger's words |
| content_tags | The small core collectively holds a large fraction of total global TNC control and is dominated by financial intermediaries. | content_tags.findings[7] | 0.95 | the tagger's words |
| content_tags | The existence of ownership ties correlates with financial ties in several countries, motivating a systemic-risk hypothesis. | content_tags.findings[8] | 0.95 | the tagger's words |
| content_tags | No study establishes or excludes that the international core has acted as a competition-hampering bloc. | content_tags.findings[9] | 0.95 | the tagger's words |
| content_tags | Control concentration is robust across three different ownership-to-control models. | content_tags.findings[10] | 0.95 | the tagger's words |
| content_tags | The method generalizes to directed weighted networks carrying resources, energy, or another scalar quantity. | content_tags.findings[11] | 0.95 | the tagger's words |
| content_tags | a person or firm owning another firm entirely or partially also in: ownership | content_tags.definitions[0] | 0.95 | the tagger's words |
| content_tags | a directed weighted graph with firms as nodes and ownership ties as links also in: ownership network | content_tags.definitions[1] | 0.95 | the tagger's words |
| content_tags | the chance of a shareholder's interest prevailing in a firm's business strategy also in: control | content_tags.definitions[2] | 0.95 | the tagger's words |
| content_tags | the total economic value over which an actor has direct and indirect influence also in: network control | content_tags.definitions[3] | 0.95 | the tagger's words |
| content_tags | firms in which every member owns shares directly or indirectly in every other member also in: strongly connected component | content_tags.definitions[4] | 0.95 | the tagger's words |
| content_tags | in-section, out-section, strongly connected core, tubes, and tendrils also in: bow-tie | content_tags.definitions[5] | 0.95 | the tagger's words |
| content_tags | the network's dominant strongly connected component also in: core | content_tags.definitions[6] | 0.95 | the tagger's words |
| content_tags | the fraction of top holders cumulatively holding a specified share of total control also in: concentration | content_tags.definitions[7] | 0.95 | the tagger's words |
| content_tags | the small, mutually connected core holding a large share of global corporate control also in: super-entity | content_tags.definitions[8] | 0.95 | the tagger's words |
| content_tags | 43060 — TNCs in the OECD-defined starting list | content_tags.quantities[0] | 0.95 | the tagger's words |
| content_tags | about 30 million — economic actors in Orbis 2007 | content_tags.quantities[1] | 0.95 | the tagger's words |
| content_tags | 600508 — nodes in the resulting TNC network | content_tags.quantities[2] | 0.95 | the tagger's words |
| content_tags | 1006987 — ownership ties in the resulting network | content_tags.quantities[3] | 0.95 | the tagger's words |
| content_tags | 3/4 — share of all nodes in the largest connected component | content_tags.quantities[4] | 0.95 | the tagger's words |
| content_tags | 94.2% — share of total TNC operating revenue in the largest component | content_tags.quantities[5] | 0.95 | the tagger's words |
| content_tags | 1347 nodes — size of the dominant strongly connected core | content_tags.quantities[6] | 0.95 | the tagger's words |
| content_tags | ownership share also in: ownership share | content_tags.variables[0] | 0.95 | the tagger's words |
| content_tags | operating revenue also in: operating revenue | content_tags.variables[1] | 0.95 | the tagger's words |
| content_tags | network control also in: network control | content_tags.variables[2] | 0.95 | the tagger's words |
| content_tags | network topology also in: network topology | content_tags.variables[3] | 0.95 | the tagger's words |
| content_tags | models used to estimate control also in: models used to estimate control | content_tags.variables[4] | 0.95 | the tagger's words |
| content_tags | investor protection also in: investor protection | content_tags.variables[5] | 0.95 | the tagger's words |
Tags that could not be placed in the text:
What was deliberately not tagged, and why, is recorded per paper by the tagger. Where a paper has no such record, this page says so rather than implying that nothing was declined.