Authors: Ivan Light
Addresses: Department of Sociology, University of California, Los Angeles, CA 90095, USA
Abstract: 'Undercapitalised' conventionally refers to firms at risk of failure because owners lack requisite human and financial capital. Are firms 'undercapitalised' when owners lack social and cultural capital? Answering the question directs attention to owners who, abundantly equipped with human and financial capital, fail in business anyway. When we have ruled out adventitious causes, such as business cycle, technology change, even luck, we are left with 'incompetence' to cover all such failures. However, 'incompetence' is a label, not an explanation. To illustrate the distinction, this paper introduces a case study of Donald Trump's much-studied career in independent business. Deficits of social and cultural capital explain Trump's repeated bankruptcies and meagre lifetime earnings.
Keywords: forms of capital; social capital; cultural capital; undercapitalisation; business failure; Donald Trump; bankruptcy; narcissism; paranoia; class resources; achievement.
International Journal of Business and Globalisation, 2021 Vol.29 No.2, pp.275 - 290
Received: 09 May 2019
Accepted: 09 May 2019
Published online: 18 Oct 2021 *