Veblen, Commons, and the Modern Corporation: Why Management Does Not Fit Economics

Le Texier, Thibault
March 2013
Homo Oeconomicus;2013, Vol. 30 Issue 1, p79
Academic Journal
From the late eighteenth century, economics revolved largely around the market. At the end of the nineteenth century, the everyday activities of developing corporations modified the usual field of economic investigations. However, economists were slow off the mark and seemed reluctant to give a proper place to this new player in their theoretical schemes. In particular, they had difficulties to grasp the managerial nature of the firm. Thorstein Veblen and John Commons offered the first comprehensive history of the modern business company. Little interested in the anatomy of the corporate leviathan, they rather analysed its double-sided spirit, both pecuniary and industrial. By doing so, they cast important thoughts on the business firm as an institution to be taken into account by economists. Yet, they failed to shift economic theory from its prevailing market orientation and to acknowledge the growing effects of the managerial rationality within the economic realm.


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