The Economics of Inequality and Global Business Responsibility
- International Academy
- Dec 1, 2025
- 14 min read
Author: Lina Moretti – Affiliation: Independent Researcher
Abstract
Economic inequality has become one of the defining challenges of twenty-first-century capitalism. While governments and international organizations often receive most of the attention, global businesses are increasingly expected to respond to widening income and wealth gaps through fairer value chains, decent work, and socially responsible investment. This article explores the economics of inequality and global business responsibility by bringing together three influential theoretical perspectives: Bourdieu’s forms of capital, world-systems theory, and institutional isomorphism. Using a qualitative, theory-driven review of recent literature and policy reports, the article examines how multinational firms shape inequality through wages, supply chains, tax practices, and digital platforms; how new expectations around environmental, social, and governance (ESG) performance and stakeholder capitalism are emerging; and how firms differ in their responses.
The analysis identifies three central mechanisms through which global businesses can reduce inequality: (1) redistribution within the firm through wage policies, inclusion in decision-making, and investment in skills; (2) fairer governance of global value chains, including living-wage commitments, responsible sourcing, and shared technology; and (3) collective institutional change through industry standards, reporting frameworks, and multi-stakeholder initiatives. At the same time, it shows how symbolic responsibility claims, weak enforcement, and the structural logic of profit maximization can limit impact. The findings suggest that business responsibility for inequality is real but uneven, shaped by power relations, competitive pressures, and institutional environments. The article concludes that meaningful progress requires combining firm-level initiatives with stronger regulation, international tax cooperation, and worker voice, while recognizing that the struggle over inequality is also a struggle over the distribution of economic, social, cultural, and symbolic capital.
1. Introduction
Economic inequality is no longer a marginal concern for economists and policy-makers; it is at the center of global debates about growth, democracy, and sustainability. Research over the last two decades has documented rising income and wealth concentration in many countries, even when overall global poverty has declined. Studies by Piketty, Atkinson, and others have shown that top income shares and fortunes have grown faster than median wages in many advanced and emerging economies, while wealth has become more concentrated across generations. At the same time, global supply chains link consumers in high-income countries with workers in lower-income contexts, often under precarious conditions.
Global businesses stand at this intersection. On one hand, multinational firms are key engines of innovation, productivity, and job creation. On the other, they can amplify inequality through wage dispersion, outsourcing, aggressive tax planning, and the growing dominance of intangible assets and digital platforms. Recent public debates around “inclusive capitalism,” “shared value,” and ESG (environmental, social, and governance) agendas show that businesses are under pressure to demonstrate that they are part of the solution, not only part of the problem.
This article asks: How do the economics of inequality intersect with global business responsibility, and what realistic pathways exist for businesses to address inequality? To answer this question, it integrates sociological and political-economic theories with recent empirical insights from management, development economics, and global governance. The focus is on global businesses—especially multinational corporations (MNCs)—because their decisions about employment, sourcing, taxation, and technology diffusion have transnational consequences.
The structure is as follows. The next section presents the theoretical background, drawing on Bourdieu’s forms of capital, world-systems theory, and institutional isomorphism to frame inequality and corporate responses. The method section outlines the qualitative, theory-driven literature review and analytical strategy. The analysis then examines four arenas in which global businesses interact with inequality: (1) wages and internal labor markets; (2) global value chains; (3) taxation and financialization; and (4) ESG responsibility and institutional pressures. The findings summarize the main patterns and tensions identified. The conclusion reflects on what responsible global business might realistically contribute to reducing inequality, and what must come from broader institutional reform.
2. Background: Theoretical Framework
2.1 Bourdieu: Capital, fields, and inequality
Pierre Bourdieu’s theory of capital provides a rich lens for understanding inequality beyond income and wealth. For Bourdieu, agents possess and struggle over different forms of capital: economic (financial resources and assets), social (networks and connections), cultural (knowledge, skills, credentials), and symbolic (recognition and legitimacy). These capitals operate within “fields” – structured arenas such as the corporate sector, higher education, or global finance – where actors compete for advantage (Bourdieu, 1986; Bourdieu & Wacquant, 1992).
Applied to multinational business, Bourdieu’s framework suggests that global firms not only accumulate economic capital, but also produce and distribute cultural capital (through training and credentialing), social capital (through transnational networks), and symbolic capital (through branding, ESG scores, and rankings). Inequality is shaped by uneven access to these capitals both within firms (e.g., between executives and low-wage workers) and across the global economy (e.g., between headquarters and peripheral suppliers). Business responsibility, in this view, involves re-balancing these capitals: widening access to skills and credentials, recognizing workers’ knowledge, and transforming symbolic capital from mere “CSR image” into genuine recognition for fair practices.
2.2 World-systems theory: Core, periphery, and global value chains
World-systems theory, associated with Wallerstein and later scholars, interprets the world economy as a hierarchical system of core, semi-peripheral, and peripheral regions linked through trade, investment, and labor flows (Wallerstein, 2004). Core countries specialize in high-value-added production and retain technological and financial advantages, while peripheral regions supply raw materials, low-cost labor, and often bear environmental costs.
In the contemporary era, global value chains (GVCs) can be seen as organizational expressions of this world-system. Lead firms in the core design, brand, and coordinate production across multiple countries, capturing a large share of value while suppliers in lower-income regions operate with narrow margins and limited bargaining power (Gereffi, 2019). From this perspective, global businesses are central actors in reproducing or transforming global inequality. Ethical sourcing, living wages, and support for local upgrading are possible mechanisms of responsibility, but they occur within a structure that tends to favor the core.
2.3 Institutional isomorphism: Why firms converge on “responsibility”
Institutional isomorphism, developed by DiMaggio and Powell (1983), explains why organizations within a field often become more similar over time. Three mechanisms are identified:
Coercive isomorphism: pressures from laws, regulations, and powerful stakeholders.
Normative isomorphism: professional norms, standards, and educational pathways that shape what is considered legitimate.
Mimetic isomorphism: imitation of supposedly successful or legitimate organizations under conditions of uncertainty.
When applied to global business responsibility, institutional isomorphism suggests that ESG practices and inequality-related initiatives diffuse partly because firms face regulatory requirements (e.g., reporting on non-financial indicators), normative expectations (from professional associations, rating agencies, and NGOs), and competitive pressure to match peers’ sustainability claims. However, convergence does not automatically mean deep change. Isomorphic pressures can lead to “ceremonial” compliance, where firms adopt similar reporting formats without substantially altering wage structures, tax strategies, or power relations.
By combining these three frameworks, the article approaches the economics of inequality and global business responsibility as: (1) a struggle over multiple capitals and recognition (Bourdieu), (2) embedded in a hierarchical world economic structure (world-systems), and (3) shaped by institutional pressures that can drive both genuine change and superficial conformity (institutional isomorphism).
3. Method
This article uses a qualitative, theory-driven literature review combined with conceptual analysis. The aim is not to produce new statistical estimates of inequality, but to synthesize existing research and policy discussions in order to clarify how global businesses are implicated in inequality and what responsibilities they may reasonably assume.
Three main steps guide the method:
Selection of theoretical and empirical sources
Foundational texts on inequality and capitalism (e.g., Piketty, Stiglitz).
Sociological and political economy perspectives, including Bourdieu, world-systems theory, and institutional theory.
Recent empirical studies (roughly the last five years) on wages, global value chains, ESG initiatives, and corporate tax practices.
Thematic coding and synthesisThe selected literature is coded around four themes: (a) internal wage and labor-market inequality; (b) inter-firm and global value-chain inequalities; (c) tax, financialization, and wealth concentration; and (d) institutionalization of business responsibility (ESG, sustainability reporting, and stakeholder governance). Each theme is analyzed using the three theoretical lenses previously outlined.
Analytical integrationThe article then integrates these themes to identify mechanisms through which global businesses contribute to or mitigate inequality, highlighting both structural constraints and areas of agency. While the methodology is qualitative, it uses empirical findings from multiple disciplines to ground the discussion in observable trends rather than purely normative arguments.
This approach is appropriate for STULIB.com because it aims to provide a clear, human-readable overview that is still grounded in rigorous, peer-reviewed research and established theories.
4. Analysis
4.1 Inequality inside the firm: Wages, skills, and symbolic recognition
One of the most visible dimensions of inequality is the widening gap between top executives and average workers. Research on CEO pay ratios shows that in many large corporations, executive compensation has grown faster than median wages over recent decades, driven by stock options, bonuses, and the financialization of corporate governance (Piketty, 2014; Stiglitz, 2015).
From a Bourdieusian perspective, this is not only a matter of more economic capital for executives, but also of cultural and symbolic capital. Executive elites often hold prestigious degrees, global networks, and the symbolic legitimacy of being seen as “value creators.” This concentration of capital shapes internal hierarchies and decision-making. Meanwhile, frontline workers’ skills and knowledge may be undervalued, particularly in routine or outsourced tasks.
Business responsibility for internal inequality can take several forms:
Fair wage policies: reducing extreme pay ratios, establishing living wage floors, and ensuring transparent criteria for promotion and bonuses.
Investment in skills and cultural capital: providing training, educational support, and career pathways for lower- and middle-level employees to accumulate cultural capital.
Inclusive governance: giving workers a voice in decision-making (e.g., works councils, employee representatives on boards) can redistribute social and symbolic capital within the firm.
Recent debates around “just transition,” diversity and inclusion, and decent work show that some firms are experimenting with such practices, especially in Europe and in sectors facing high public scrutiny. However, these efforts often remain partial and voluntary.
4.2 Inequality across global value chains: The core–periphery dynamic
Global supply chains extend corporate responsibility far beyond the factory walls. World-systems theory highlights how core countries and firms capture the highest-value segments of production, while peripheral suppliers engage in labor-intensive, low-margin tasks. This is visible in industries such as garments, electronics, and agribusiness, where multinational brands rely on networks of suppliers in lower-income regions.
Inequality arises in several ways:
Wage differentials: Workers in supplier factories may earn only a fraction of living wages, even as products sell for high prices in global markets.
Risk transfer: Suppliers bear the brunt of demand fluctuations, currency shifts, and compliance costs, while lead firms maintain flexibility.
Limited upgrading: Suppliers often remain locked into low-value-added functions, with limited access to technology, design capabilities, or branding opportunities.
Business responsibility in this domain includes:
Living-wage and fair-pricing commitments: ensuring that procurement prices enable suppliers to pay decent wages and comply with safety standards.
Capacity building and technology transfer: helping suppliers upgrade their processes, skills, and products rather than simply enforcing compliance.
Multi-stakeholder initiatives: participating in sector-wide accords, codes of conduct, and monitoring schemes that set common expectations.
There are examples of firms and industry initiatives that have improved safety and labor standards in specific sectors. Yet, critics argue that many “codes of conduct” remain focused on reputational risk rather than deeper shifts in value distribution. In Bourdieusian terms, lead firms often convert their symbolic capital as “ethical brands” into market advantage without fundamentally altering the distribution of economic capital along the chain.
4.3 Tax practices, financialization, and wealth concentration
Inequality is shaped not only by wages, but also by how corporate profits are distributed and taxed. Studies of global tax practices show that some multinational corporations shift profits to low-tax jurisdictions, reducing the tax base available for public services and social transfers in higher-tax countries. This can exacerbate inequality if governments respond by cutting social spending or increasing regressive taxes.
Financialization—the growing importance of financial markets, shareholder value, and leverage in corporate strategy—intensifies this dynamic. When firms prioritize short-term returns, they may favor share buybacks, dividends, and executive bonuses over long-term investment in employees, innovation, or communities. Empirical research has linked financialization to lower wage shares and higher income inequality in several economies.
From a world-systems perspective, profit shifting and financial flows reinforce the position of core countries and financial centers, while peripheral and semi-peripheral states struggle to tax global capital. From a Bourdieusian angle, financial elites accumulate not only economic capital but also symbolic capital as “market-oriented” and “efficient,” even when their strategies amplify inequality.
Global business responsibility here involves:
Responsible tax behavior: paying taxes where economic activity occurs, supporting international efforts against base erosion and profit shifting.
Long-term value orientation: adopting strategies that balance shareholder returns with investment in employees, innovation, and climate and social goals.
Transparency: country-by-country reporting of profits, taxes, and social impacts to allow scrutiny by stakeholders and regulators.
Again, institutional isomorphism plays a role: as reporting standards and tax transparency initiatives spread, firms may converge on new norms, though the depth of change depends on enforcement and public pressure.
4.4 ESG, stakeholder capitalism, and institutional isomorphism
In the last decade, ESG has moved from a niche concern to a mainstream theme in corporate governance and investment. Many large companies now publish sustainability reports, adopt human rights policies, and set targets on climate, diversity, and supply-chain conditions. At the same time, major investors and international forums have promoted ideas of “stakeholder capitalism,” suggesting that firms should serve employees, communities, and the environment alongside shareholders.
Institutional isomorphism helps explain this rapid diffusion:
Coercive pressures: regulations on non-financial reporting, human rights due diligence, and supply-chain transparency in various jurisdictions.
Normative pressures: standards from professional bodies, reporting frameworks, and rating agencies; training of managers and ESG professionals.
Mimetic pressures: firms imitate “leaders” that receive positive rankings, awards, or media attention for their responsibility initiatives.
While these developments create opportunities for more serious engagement with inequality, they also risk turning responsibility into a branding exercise. Firms might focus on easily measurable indicators or public commitments while avoiding more difficult questions about pay ratios, unionization, or tax practices.
From a Bourdieusian standpoint, ESG can be interpreted as the accumulation of symbolic capital—recognition for being “responsible.” The key question is whether this symbolic capital is grounded in genuine transformation of economic and social relations or is mainly a symbolic asset used for reputation management.
4.5 Digital platforms, AI, and new forms of inequality
A particularly dynamic area in the economics of inequality is the rise of digital platforms and artificial intelligence. Platform business models can create winner-takes-most dynamics, where a small number of firms capture large shares of global markets and data. Gig workers often face unstable incomes and limited social protection, while data and algorithmic power concentrate in a few corporations.
Recent studies highlight both risks and opportunities. On one hand, digital platforms can provide income opportunities and access to global markets for small firms. On the other, they may erode traditional employment protections and shift bargaining power away from workers. AI tools can enhance productivity but also automate tasks, potentially polarizing labor markets between high-skill and low-skill workers.
In world-systems terms, digital platforms can deepen core–periphery divides, as leading firms are often located in a few countries, while users and workers are dispersed globally. In Bourdieu’s framework, data and algorithms become new forms of economic and symbolic capital, while digital skills become critical cultural capital. Businesses that wish to act responsibly must consider how their digital strategies affect access to skills, data governance, and the distribution of value in platform ecosystems.
5. Findings
Synthesizing the literature and theoretical discussion, several key findings emerge about the relationship between the economics of inequality and global business responsibility.
5.1 Responsibility exists, but within structural constraints
Global businesses do possess agency that can influence inequality. They can set wage policies, shape purchasing practices, choose tax strategies, design digital platforms, and participate in industry initiatives. Many concrete examples show that firm-level decisions have improved working conditions, raised wages in specific sectors, or increased investments in inclusive skills development.
However, this agency operates within structural constraints: competitive markets, shareholder expectations, global tax regimes, and core–periphery inequalities. A single firm that dramatically increases wages or restructures its supply chain may face cost disadvantages unless others follow or regulations create a level playing field. World-systems theory reminds us that systemic change requires more than isolated corporate initiatives.
5.2 Multiple capitals and fields shape business responses
Bourdieu’s framework reveals that inequality is not only about money but also about who has access to cultural, social, and symbolic capital. Global businesses often hold strong positions in multiple fields—economic, political, and cultural—and their responsibility initiatives are shaped by these positions.
For example, a firm with strong symbolic capital as a “sustainability leader” may have more freedom to experiment with progressive wage policies. Conversely, firms heavily dependent on low-cost production may feel constrained. Efforts to reduce inequality must therefore consider not only redistributing pay, but also redistributing training, recognition, and voice.
5.3 ESG and isomorphism can be both drivers and limits
Institutional isomorphism is a double-edged sword. On one side, spreading norms and standards around responsible business create pressure for laggards to catch up and make it easier for regulators and civil society to compare firms. On the other side, isomorphic adoption of similar ESG frameworks can result in homogeneous but shallow responses, where reporting and branding outpace actual change.
The evidence suggests that impact depends on the strength of enforcement, the involvement of workers and communities in monitoring, and alignment between responsibility goals and core business models. Where ESG is integrated into strategy and governance, it can support real progress; where it is disconnected, it risks becoming symbolic.
5.4 Digital transformation is reshaping the inequality–business nexus
Digitalization and AI are intensifying existing patterns of inequality but also providing new tools for inclusion. Businesses’ decisions about data ownership, algorithm design, and platform governance will significantly affect future inequality. Responsible global firms can contribute by:
Ensuring fair working conditions for gig and platform workers.
Investing in digital skills for marginalized groups.
Designing AI systems that enhance rather than replace meaningful work.
These choices again depend on regulatory frameworks, competitive pressures, and strategic vision.
5.5 Business responsibility must be complemented by public policy
Finally, the literature consistently emphasizes that business responsibility, while important, cannot substitute for effective public policy. Progressive taxation, quality public education and health, active labor-market policies, and strong labor rights are essential tools to reduce inequality. Without these, corporate initiatives risk being isolated “islands” of good practice in a sea of structural inequality.
Nonetheless, global businesses can play constructive roles by supporting fair tax reforms, complying with labor and environmental regulations, collaborating with governments and civil society on skills and social protection, and refraining from lobbying against inclusive policies.
6. Conclusion
The economics of inequality and global business responsibility are deeply intertwined. Global businesses are both contributors to, and potential mitigators of, inequality. Their influence extends from internal wage structures to global value chains, taxation, financial flows, and digital platforms.
By combining Bourdieu’s theory of capital, world-systems analysis, and institutional isomorphism, this article highlights that:
Inequality is multidimensional, involving not only income and wealth but also access to skills, networks, and recognition.
Global value chains and digital platforms embed firms in a hierarchical world economy where value and risk are unevenly distributed.
Institutional pressures around ESG and stakeholder capitalism are reshaping expectations of corporate behavior, but can produce both genuine transformation and superficial conformity.
In practical terms, responsible global business for inequality would involve at least four pillars:
Internal fairness: reasonable pay ratios, living wages, inclusive governance, and investment in employees’ skills and well-being.
Fair global value chains: procurement practices that support living wages, safety, and upgrading for suppliers and workers in lower-income regions.
Responsible financial and tax behavior: alignment of profit strategies with long-term value, transparent and fair tax practices, and limits on financialization that undermines labor’s share of income.
Support for inclusive institutions: cooperation with governments and civil society to strengthen social protection, labor rights, and education systems, rather than lobbying against them.
Yet, as world-systems theory reminds us, systemic inequalities cannot be resolved by corporate choices alone. They require coordinated efforts across states, international organizations, and social movements. Businesses can either resist or support these changes. When they choose to support them, they must accept some redistribution of economic, social, and symbolic capital.
Ultimately, the struggle against inequality is not only a technical matter of better metrics or smarter ESG strategies. It is a political and ethical question about what kind of global economy we want, who participates in its decisions, and how the benefits of growth are shared. If global businesses are serious about responsibility, they must engage with this question not only in their sustainability reports, but in their core strategies, governance, and everyday practices.
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References
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