On the importance of capital application to enterprise development

The core content of consumption capitalization theory is to extend consumption to the field of production and operation. Manufacturers and commercial enterprises should regard consumers' purchase of their own products as an investment in their own enterprises, and return a certain percentage of profits to consumers every once in a while. In this way, the consumer's consumption behavior is no longer a simple consumption, but at the same time becomes a saving behavior and an investment behavior that participates in enterprise production. In fact, this has promoted consumers to be investors from the end to the front of the product chain, allowing consumers to share the fruits of enterprise growth when purchasing products, organically combining consumption and investment, and integrating buyers and sellers.

The theory of consumption capitalization can provide theoretical support for expanding consumer demand. The purpose of developing production is consumption, and production and consumption are two sides of the same problem. The theory of consumption capitalization pays attention to both production and consumption, and puts forward that consumers are not only the masters of the market, but also inject new capital power into economic development from a new perspective that consumers' consumption behavior is also an investment behavior. The theory of consumption capitalization is committed to achieving a win-win situation for producers, operators and consumers, thus promoting the sustainable development of social economy. Generally speaking, expanding consumer demand is to stimulate demand by reducing taxes and increasing loans, which is an external stimulus to consumption, that is, consumers are passive. The theory of consumption capitalization has the function of mobilizing consumers' enthusiasm for consumption, because it transforms consumption into capital.

Consumption Capitalization Theory ——2 1 An Important Invention of Century Economics

For a long time, people have always attached great importance to the capital and market problems faced by cities and enterprises in the process of economic development. Especially when there is a shortage of funds, the problem is particularly prominent. This is a problem that needs further study and solution. Our research task is to find out the historical background and causes of this problem and find a scientific solution.

In the new century, local leaders and entrepreneurs will face and own three kinds of capital, namely monetary capital, knowledge capital and consumption capital, instead of single or unique monetary capital. This theory will solve the problem of capital shortage in the development of cities and enterprises and effectively promote economic development.

Analyzing the market economy in the last two hundred years, we can see that in the first hundred years, most parts of the world relied solely on monetary capital to expand and develop their economies. After more than one hundred years' development, people gradually realize that there is another kind of capital to promote economic development, which is the intellectual capital that became clear in the 1980s. With the practice of economic development and the deepening of the corresponding economic theory research, at the end of the 20th century and the beginning of the 21st century, people gradually realized that there is a huge capital stock, that is, the third form of capital-consumption capital, which, like monetary capital and knowledge capital, is also the direct driving force to promote the economic development of countries, regions and enterprises.

▲ Monetary capital

For centuries, until today, monetary capital is still the direct driving force for the economic development of a country, a nation, a region and an enterprise, and it will still play an important role for a long time to come, which is beyond doubt. We can call it a mixed growth model of production capital and financial capital, that is, the regional and enterprise economies mainly rely on the monetary capital provided by banks to develop. This basic model of economic development has lasted for centuries. Until today, it is still a development model that some countries and regions rely on. This economic development model has also created human historical civilization.

However, with the rapid development of science and technology and the arrival of a new era, this traditional basic model of economic development has shown its limitations and shortcomings. Its limitations and shortcomings are mainly manifested in: relying solely on monetary capital, the traditional economic development model, often leads to the shortage of funds and becomes the bottleneck of regional and enterprise economic development. This problem has been puzzling the leaders of some countries, regions and enterprises and hindering the economic development. The research tasks we face are: on the one hand, we should continue to play the role of monetary capital in economic development, and at the same time, we should solve the bottleneck problem of monetary capital shortage that is often faced by traditional economic expansion and development relying solely on monetary capital.

▲ knowledge capital

In the first hundred years, people always thought that capital and labor created wealth. But a hundred years later, people gradually discovered that a considerable part of wealth was not created only by capital and labor. People realize that new science and technology, that is, the crystallization of human knowledge, plays an important role in creating wealth. That is to say, besides monetary capital, there is also a form of capital, that is, the crystallization of human knowledge, and high technology is also the direct driving force to promote economic development. This is the second form of capital that people clearly recognized later, that is, knowledge capital. Its specific functions are as follows: When monetary capital can not fully meet the economic development needs of a country, a region or an enterprise, knowledge capital plays the role of turning the stone into gold. It can expand the strength of existing monetary capital several times and ten times, promote the economic development of regions and enterprises themselves, and create more wealth. This mode of combining monetary capital and knowledge capital to promote economic development has been tried and practiced in some developed countries for a period of time and has received good results. However, in developing countries and regions with underdeveloped market economy, it has not been fully developed. Many regions still only rely on monetary capital, and do not fully realize the important role of intellectual capital in economic development.

Developing countries should study and think deeply about this issue and find a new way for monetary capital and knowledge capital to jointly develop their economies as soon as possible. Find out the appropriate form of the combination of monetary capital and intellectual capital suitable for China, the region and the enterprise, and complete the combination of monetary capital and intellectual capital. This will be of immeasurable significance to the economic development of countries, regions and enterprises. Developing countries should gradually embark on the road of knowledge economy leading the future development.

▲ Theory of consumption capital and consumption capitalization

For centuries, with the continuous development of economy, more and more entrepreneurs have deeply realized that consumers are the ultimate decisive force in market competition. Because they are not only the masters of the market, but also the source of injecting new capital into enterprises. Therefore, whoever can win the most consumers will have the largest market and huge capital injection, and consumer capital is born from this, and the construction of "consumption capitalization theory" is also based on this.

The core content of consumption capitalization theory is to extend consumption to the production field. When consumers buy products from enterprises, production enterprises and commercial enterprises should regard consumers' purchase of their own products as an investment in their own enterprises and return a certain percentage of profits to consumers at regular intervals. At this time, the consumer's purchase behavior is no longer a simple consumption, but his consumption behavior has become a saving behavior and an investment behavior to participate in enterprise production. So consumers are also investors, and consumption is transformed into capital.

In fact, this is to promote consumers as investors from the end to the front of the product chain, so that consumers can share the fruits of enterprise growth while purchasing products, and at the same time inject new impetus into enterprise development, so that consumption and investment can be organically combined. Thus, buyers and sellers are integrated under this condition, and the process of transforming consumption into capital is completed. In this way, as a kind of capital, consumption, like monetary capital and knowledge capital, has become the direct driving force for the development of enterprises and local economies.

The difference between consumption capitalization theory and consumer sovereignty theory

Consumption capitalization theory is different from Hayek's "consumer sovereignty theory". Hayek, winner of the Nobel Prize in Economics, once put forward the "consumer sovereignty theory". "Consumer sovereignty" first appeared in Adam Smith's The Wealth of Nations, the father of modern economics. Later, both the Austrian School and the Cambridge School regarded "consumer sovereignty" as the most important principle in market relations. The so-called "consumer sovereignty" is a concept to explain the relationship between consumers and producers in the market, that is, consumers buy the goods they need in the market according to their own wishes and preferences, so as to convey their wishes and preferences to producers through the market, so all producers arrange production according to the opinions of consumers and provide the goods they need. In other words, what to produce and how much to produce ultimately depend on the wishes and preferences of consumers. Consumer sovereignty can be explained by a metaphor. Every dollar spent by consumers in the market is equivalent to a vote. Consumers like a certain commodity and are willing to spend money to buy it, so they will vote for him, that is, they are willing to buy his commodity, otherwise the commodity will be unsalable and the producer will lose money. It is through the "coin-in" of consumers in the market that each producer can understand the social consumption trends and consumer trends, so as to arrange labor and production materials, improve technology, reduce costs, increase categories to meet the requirements of consumers, and finally achieve the goal of maximizing profits.

The theory of consumer sovereignty has also caused controversy. For example, Galbraith, another economist who won the Nobel Prize in Economics, put forward the concept of "producer sovereignty" according to the reality that large companies monopolize the market. However, Hayek believes that even if the market is completely monopolized, producers' production must comply with consumers' wishes, otherwise large companies will lose the ultimate motivation for development, production will be in a restricted state, and their existing monopoly position will eventually be lost, which is harmful to the company and the whole social economy. Since 1980s, the rise and fall of big companies such as Apple Computer Company, McDonnell Douglas Company and Compaq Company have repeatedly verified the correctness of consumer sovereignty theory in practice.

The theory of consumption capitalization comes down in one continuous line with the theory of consumer sovereignty, but it breaks through the limitations of classical and neoclassical economics and Hayek's theory, and is a theoretical innovation and development in the era of deflation and consumption austerity. The theory of consumer sovereignty only clarifies the importance of consumers, and only solves the problem of "what is it", but does not solve the problem of "how to do it", that is, it does not discuss how producers should get the support of consumers under the premise of "consumer sovereignty". In addition, in the theoretical model, the consumer sovereignty theory holds that producers and consumers are antagonistic, and the sovereignty of consumers corresponds to the obedience of producers. I don't realize that producers and consumers can combine organically under certain mechanisms to realize the capitalization of consumption in the market. The theory of consumption capitalization is mainly aimed at how to realize the organic combination of producers and consumers under the new economic conditions. By constructing various types of market systems, production and consumption will move from opposition to unity, so as to maximize consumers' sovereignty and profits at a higher level through the capitalization of consumption.

Application of Consumption Capitalization Theory

The theory of consumption capitalization can be realized in many forms in practice and application, such as consumer investment, consumer rights participation, consumer choice, consumer choice and so on. Through these channels, consumption can extend to the production field and realize the capitalization of consumption at different levels.

The most basic form of the application of consumption capitalization theory in practice is "consumption investment", that is, producers inject a certain proportion of unit sales income into personal investment accounts opened by consumers in enterprises, and then return the accumulated amount of personal investment accounts and a certain proportion of enterprise profits to consumers in stages according to the profitability of enterprises, so that consumers can participate in enterprise investment and share the development achievements of enterprises, thus achieving the purpose of attracting consumers and realizing consumption capitalization. At this time, the consumer's purchase behavior is no longer simply to obtain goods, but his consumption behavior has become a saving behavior and an investment behavior to participate in enterprise production, which can eliminate the opposition between buyers and sellers to a certain extent and solve the fundamental contradiction between consumers and producers.

The application of consumption capitalization theory in practice is multifaceted, multi-angle, multi-level and efficient. Even if enterprises adopt "consumption investment", the most basic form of consumption capitalization, they can obtain the following expected effects:

First, economies of scale.

Capitalization of consumption can bring scope economy effect and regional economy effect to enterprises, which are the two most important components of scale economy. The innovation of consumption capitalization in theory and practice will bring great "attention economics" benefits to academia, business circles and press. Consumption capitalization is different from the business philosophy and sales methods of all enterprises so far, and it has strong freshness and charm, which will have a great impact on consumers' psychology-the psychology and affinity of actively participating in trials, the great attraction and cohesion of being willing to cooperate for a long time-and consumers who catch up with the trend of the times will be condensed in the enterprises that initially try to capitalize consumption under the guidance of news media. Thereby giving enterprises the image of respecting consumer sovereignty and caring about consumer interests, which is welcomed by consumers. The popularity of a local enterprise can be rapidly extended to the whole country, and at the same time it is well known by more industries, which is conducive to the expansion of the product range and geographical scope of the enterprise, and the scale economy effect will be very obvious.

Second, the consumption agglomeration effect

When an enterprise regards consumers as investors and members of the enterprise through consumption capitalization, consumers also think so from the other end, because the process of consumption capitalization can make consumers benefit from the enterprise for a long time and share the development achievements of the enterprise. Consumers are no longer simple consumers, and affinity will make consumers gather around such enterprises and keep long-term attention on the operation and development of enterprises. On this basis, enterprises will attract more consumers through high-quality products and meticulous and thoughtful services, establish a corporate image with good reputation and strong affinity in the minds of consumers, and gradually strengthen interaction. Through complete information circulation channels and sincere and thoughtful service, the loyalty of consumers is cultivated, and the development of enterprises is greatly promoted through consumption aggregation effect.

Third, the capital precipitation effect.

The development of enterprises can not be separated from capital, or in the short term, capital is the most important determinant of enterprise development. An important role of consumption capitalization is to create a huge capital stock for enterprises. Take consumption investment, the most basic form of consumption capitalization, as an example. When an enterprise credits a certain proportion of the consumer's consumption of products (equal to the net sales income) to the consumer's personal investment account in the form of bookkeeping (the actual funds have been put into the enterprise's reproduction), after a period of time (such as 1 year), the enterprise begins to return it to the consumer in the form of funds or products according to the ratio of the account balance to the enterprise's profitability. There is a time lag between the income and expenditure of enterprises, which makes enterprises completely rely on the input of consumers who join later to pay the returns that consumers who join first should get. Enterprises always keep the stock of capital. With the expansion of consumption scale, this precipitated capital stock will increase with arithmetic or geometric base, and the development of enterprises will be supported by another channel.

Fourth, social capital effect.

"Social capital", as a capital concept different from that defined by economics and demography, has a wide and far-reaching influence in economics and sociology, although it appears in the relevant literature of 1977. Social capital theory, also known as social network theory, is characterized by interpreting information from the perspective of interpersonal network rather than technical network. Robert Putnam, a political scientist at Harvard University, is the founder of social capital theory. In his book Let Democracy Work, he clearly pointed out that social capital was born and embodied in people's communication network. Due to people's participation in social economy, social capital has gradually evolved into an economic resource that can make people trust each other and repay good with good, and people cooperate with each other for the same interests. Putnam also believes that social capital is a prerequisite for economic development, and the strength of social capital determines the difference in the level of economic development. After Putnam, the understanding of social capital by foreign sociologists is represented by Coleman and Bourdieu. Coleman believes that social capital is the capital property owned by individuals, which is manifested as social structure resources. They are composed of elements that constitute the social structure, which mainly exist in interpersonal relationships and social structures, providing convenience for individual actions within the structure; Bourdieu believes that social capital is a collection of actual or potential resources obtained by occupying an "institutionalized relationship network". The owners of social capital can be individuals, groups, organizations, communities, enterprises, etc. And their manifestations are social structure resources, but social structure resources themselves are not social capital, and only after mobilization can they become social capital. Actors hold the expectation of social capital return, which has the same instrumental effect as other capitals. Corporate social capital refers to the ability of enterprises to absorb scarce resources through vertical connection, horizontal connection and social connection. The size of enterprise social capital is influenced by two main factors: economic structure and entrepreneur's initiative. Social capital plays a direct role in promoting the business ability and economic benefits of enterprises.

Applying the theory of consumption capitalization to practice can enrich the social capital of enterprises, integrate market resources and form a powerful market with enterprises as the core and consumers as the driver.

Verb (abbreviation of verb) market pressure effect

Capitalization of consumption enables enterprises to gain market forces such as monetary capital and social capital, and at the same time bear more constructive market pressure. Consumers' investment in the enterprise and shallow participation in the production and sales of the enterprise are also conducive to improving the quality management awareness of the enterprise and collecting and processing market demand information in a wider scope and depth. Under this market pressure, enterprises will eventually undergo fundamental changes in improving product quality, reducing production costs, and even in property rights reform and modern enterprise system construction.

The above is only an analysis of the effect of consumption investment, which is the most basic form of consumption capitalization theory. A higher level of consumption capitalization corresponds to a broader and far-reaching social, economic, political and cultural impact.

In a word, the study of consumption capitalization theory is not only of great significance to the development of economic theory, but also will play an important role in promoting the development of market economy.