Economic Institutions: Spontaneous and Intentional Governance

Spontaneous governance has been the prevailing economic approach to economic organization since Adam Smith made perceptive reference to, and briefly described, the "invisible hand," according to which each businessman "by pursuing his own interest . . . frequently promotes that of society more effectively than when he really intends to promote it" (Smith:423). That formulation is properly regarded as a watershed event and has had a massive and continuing influence on economics. One of the most praiseworthy intellectual activities with which an economist can become engaged is to identify and explicate spontaneous control mechanisms through which hands-off governance operates. Not only does it take a powerful mind-or, usually, the combined efforts of many powerful minds-to discover and model the mechanisms of spontaneous governance, but the benefits are stupendous. The need to become knowledgeable about, much less engrossed in the study of, institutional details is relieved if not vitiated if spontaneous mechanisms are the main arena. That we appear to be subject to intentional governance structures everywhere we turn is thus misleading: the real action is largely invisible.'

[1]  Scott E. Masten,et al.  A Legal Basis for the Firm , 1988 .

[2]  O. Williamson,et al.  Markets and Hierarchies: Analysis and Antitrust Implications. , 1977 .

[3]  J. Coleman.  Foundations of Social Theory , 1990 .

[4]  J. Litwack.  Discretionary behaviour and Soviet economic reform , 1991 .

[5]  R. Coase.  The Nature of the Firm , 1937 .

[6]  H. Simon,et al.  A Formal Theory of the Employment Relationship , 1951 .

[7]  Paul R. Milgrom,et al.  The role of institutions in the revival of trade: the law merchant , 1990 .

[8]  B. Horvat.  The Political Economy of Socialism , 1983 .

[9]  David M. Kreps.  Corporate culture and economic theory , 1990 .

[10]  T. Koopmans.  Three Essays on the State of Economic Science , 1958 .

[11]  L. Steffens.  The autobiography of Lincoln Steffens , 1931 .

[12]  L. Vogel,et al.  Strategy and Structure , 1986 .

[13]  C. Shapiro.  Consumer Information, Product Quality, and Seller Reputation , 1982 .

[14]  Paul R. Milgrom,et al.  Short-Term Contracts and Long-Term Agency Relationships , 1990 .

[15]  W. Dugger.  The Economic Institutions of Capitalism , 1987 .

[16]  J. Winiecki.  Why Economic Reforms Fail in the Soviet System--A Property Rights-Based Approach , 1990 .

[17]  E. Fama.  Agency Problems and the Theory of the Firm , 1980, Journal of Political Economy.

[18]  M. Aoki.  Information, Incentives and Bargaining in the Japanese Economy: A Microtheory of the Japanese Economy , 1988 .

[19]  C. Barnard.  The Functions of the Executive , 1939 .

[20]  H. Demsetz,et al.  Production, Information Costs, and Economic Organization , 1975, IEEE Engineering Management Review.

[21]  J. Schumpeter.  Capitalism, Socialism and Democracy , 1943 .

[22]  D. W. Fiske,et al.  The Postmodern Rhetoric of Sociology@@@Metatheory in Social Science: Pluralisms and Subjectivities. , 1986 .

[23]  Sanford J. Grossman,et al.  The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration , 1986 .

[24]  L. Hurwicz.  The Design of Mechanisms for Resource Allocation , 1973 .

[25]  O. Williamson.  The economics of discretionary behavior : managerial objectives in a theory of the firm , 1965 .

[26]  B. Ward.  The socialist economy : a study of organizational alternatives , 1967 .

[27]  Philip M. Marcus,et al.  The Visible Hand: The Managerial Revolution in American Business , 1979 .

[28]  Shorey Peterson,et al.  The Modern Corporation and Private Property. , 1933 .

[29]  R. Richter.  A Socialist Market Economy—Can It Work? , 1992 .

[30]  John Buttrick,et al.  The Inside Contract System , 1952, The Journal of Economic History.

[31]  F. Hayek.  The economic nature of the firm: The use of knowledge in society , 1945 .

[32]  David M. Kreps,et al.  A Course in Microeconomic Theory , 2020 .

[33]  M. Polanyi,et al.  Personal Knowledge: Towards a post-critical philosophy , 1959 .

[34]  J. Tirole.  Hierarchies and Bureaucracies: On the Role of Collusion in Organizations , 1986 .

[35]  Roy Radner,et al.  COMPETITIVE EQUILIBRIUM UNDER UNCERTAINTY11This research was supported in part by the Office of Naval Research under Contract ONR 222(77) with the University of California. Reproduction in whole or in part is permitted for any purpose of the United States Government. , 1968 .

[36]  H. Demsetz.  The Theory of the Firm Revisited , 1988 .

[37]  B. Klein,et al.  Vertical Integration, Appropriable Rents, and the Competitive Contracting Process , 1978, The Journal of Law and Economics.

[38]  O. Williamson.  The Vertical Integration of Production: Market Failure Considerations , 1971 .

[39]  H. Simon,et al.  Models of Man. , 1957 .