The Institutional Truth of Transaction Costs
Since Adam Smith’s example of the pin factory, economists have never been able to produce a satisfactory theory of the industrial firm. They’ve thought of it as a black box, expressed it as a...
View ArticleThe Root Flaw in Economic Thinking
The idea of economic man, sometimes given a Latin nomenclature to increase its gravitas, is the real cause of economics’ more recent failures. Forty years ago it was referred to as a nineteenth century...
View ArticleChanging Economics
A retrospective of this year’s postings would highlight some of the flaws in accepted economic theory. Many have been flagged up elsewhere: economic theory is not, and never has been, without its...
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The Importance of Agency in ‘The Rise and Fall of Management’
‘The Rise and Fall of Management’ highlights some issues as of particular importance to the current situation. For instance, the universal adoption of agency theory. Agency is a legal relationship...
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BP, the BBC and Agency Theory Again
Nowhere in British or United States law are directors (and/or managers) of the incorporated limited liability company, claimed to be the agents of shareholders. The principal, for which directors act...
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A New and Legal Orthodox Wisdom
Unilever’s Paul Polman must be a Chief Executive in a million. Or more. In his interview with Guardian Sustainable Business, Polman calls on business leaders, politicians and NGOs to recognise they...
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Saving the Friedman Legacy
Just when all the financial excitement was beginning, Paul Krugman wrote an article for the New York Review of Books entitled ‘Who was Milton Friedman?’ Was he the economists’ economist, profound...
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