3 ms·
>"The more capital you have, the more capital you are able to accrue. And capital is power. The old saying, the rich get richer, is not just the superficial, fl
by nickff 13y ago
>"The more capital you have, the more capital you are able to accrue. And capital is power. The old saying, the rich get richer, is not just the superficial, flippant comment it might appear, flung around in the pub - it describes a core characteristic of capitalism."
This is an interesting idea, but has been shown to be false. One example is that the average company on the S&P 500 lasts for less than 20 years, and this is dropping.[1] Another example can be seen by simply looking at all the richest families in the USA in 1900, and seeing which of them is still a famous dynasty; there are a number of studies on this, but it seems like family wealth does not usually last more than 3-4 generations. Even the Annheiser-Busch family, who created the still-popular Budweiser brand, have lost their empire after six generations of hard work.[2] Or look at a list of the "robber barons", and see how many of the family names correspond to the list of richest people on earth.[3]
[1] http://www.innosight.com/innovation-resources/strategy-innovation/upload/creative-destruction-whips-through-corporate-america_final2012.pdf http://www.innosight.com/innovation-resources/strategy-innov...
[2] http://en.wikipedia.org/wiki/Anheuser-Busch http://en.wikipedia.org/wiki/Anheuser-Busch
[3] http://en.wikipedia.org/wiki/Robber_baron_(industrialist) http://en.wikipedia.org/wiki/Robber_baron_(industrialist)
- bronsoja 13y agoFor your point about Anheuser-Busch, I'm not familiar enough with all that went down, so hopefully you can clarify if I'm wrong. Since the company was bought out (vs going out of business), doesn't that mean the Anheuser-Busch family (which I'm presuming had a large number of shares) would still have their wealth?
- nickff 13y agoAnheuser-Busch is a very interesting case, I would refer you to Julie Macintosh's book "Dethroning the King", or one of her excellent presentations.[1] The Wikipedia page on Augustus Busch IV states the following: >"Press reports indicated that the Busch family ownership of the company had greatly dwindled over the years with Busch's father owning only 1.2 percent of the shares at the time of the takeover. In total the Busch family owned only 4 percent of the company"[2] I think it is fair to say the the Busch family were able to preserve some of their wealth, but their status has declined drastically over time, and will likely continue to do so. I must admit that the story about this family is subjective, and anecdotal. [1] http://www.youtube.com/watch?v=kXq9Jj4LGCo http://www.youtube.com/watch?v=kXq9Jj4LGCo [2] http://en.wikipedia.org/wiki/August_Busch_IV http://en.wikipedia.org/wiki/August_Busch_IV