INTERLOCKING DIRECTORATES AND CONTROL OF CORPORATIONS: THE THEORY OF BANK CONTROL.

The article presents a paper that systematically examines corporate interlocks among major U.S. corporations from the standpoint of the theory of bank control. Sociologists Robert Fitch and Mary Oppenheimer have produced the latest major restatement of this theory. Fitch and Oppenheimer argue that through the concentration of banking and the convergence of interests among banks, the stockholdings of bank trust departments, the dependence of non-financial corporations on external financing, and the practice of interlocking directorates, a few major banks are able to control the policies of major U.S. corporations. Probably most unfavorable for the theory is the finding that being a bank is only modestly associated with interlocking. This fact could be made consistent with the theory if it was argued that many interlocks occur for reasons unrelated to bank control. Also detrimental to the theory is the finding that all except the very largest insurance companies interlock more like non-financial corporations than banks.