John F. Henry

The Business Enterprise in the Age of Money Manager Capitalism

Abstract: Thorstein Veblens going concern theory of the business enterprise has been widely received by heterodox economists. Since Veblens era, the capitalist social provisioning process has evolved toward money manager capitalism in a dialectical fashion. At the heart of the transformation are changes in the behavior of the business enterprise. In this paper, we make a threefold argument. First, while the going concern theory of the business enterprise is still important in the account of the economy as a continuing process of social provisioning, since a viable economy requires continuing business over historical time, more and more of the economy is being directed toward financial concerns. Second, as a consequence, the social provisioning process becomes more unstable and peoples welfare becomes more vulnerable. Third, the concept of a going concern is, therefore, to be modified in order to put the business enterprise in the context of money manager capitalism.

Property Rights, Markets and Economic Theory: Keynes versus Neoclassicism - again

This essay has two main objectives. Initially, I specify the relationship between neoclassical theory and the property rights regime on which that theory rests. In this portion of the argument I show that the property rights consistent with neoclassical theory are inconsistent with those of a monetary (or capitalist) economy-the economy the theory purports to explain. Further, I specify several contradictions in the theory itself when it attempts to examine rational resource allocation, money and the labor market. Secondly, I show that Keyness General Theory rests on a fundamentally different foundation than that of neoclassicism. His views on money, the labor market, equilibrium, etc. are in radical opposition to those of orthodoxy. In addition, his theory does not share the same position on property rights. Because of these considerations, Keynes cannot be understood by those economists holding the neoclassical perspective.

Keynes’ Economic Program, Social Institutions, Ideology, and Property Rights

From this foundation, economists then develop policy prescriptions that are claimed to move us closer to the optimal outcomes that would obtain if we allowed economic laws to run their natural course. Social norms, institutions, and behavior should conform to economic standards which are predicated on good theory, theory that is developed independent of any specific social context. In this regard, economic theory is seen as akin to natural law, and the closer the laws of economics are to the laws of physics, the more scientifically based the policy recommendations of economics will be (Mirowski 1989). Various economists have protested this view of things. One such economist was John Maynard Keynes, who saw the economy as embedded in larger society. The fol-

John Bates Clark: A Life, 1847–1938

John Bates Clark, the first United States economist to reach a position of prominence within this profession, was raised in an archetypal New England Puritan environment in Providence, Rhode Island. Within its Congregationalist household the family maintained a strict religious regimen that included daily prayer and a scrupulous observance of the sabbath, but there was more to such an environment than this: Equal emphasis was placed on intellectual growth as well as ‘ … keenness in the pursuit of individualistic commercial enterprise’ (A. Clark, 1938, p. 5).1

The 2017 Veblen-Commons Award Recipient: John F. Henry: “Brutus Is an Honorable Man”

Abstract: The question I pose in this article is just why, from its egalitarian foundations, inequality first arose. There is good information regarding how inequality has been defended over the millennia, but no answer as to why, from an egalitarian ideological foundation, some began to assert a superior position, while others — the vast majority, in fact — accepted this. In this historic process that leads to the current period, it appears that those asserting a superior position are of an “honorable” nature. That is, they tend to be mass murderers, fundamentally dishonest, hypocrites, and generally anti-social. Just why is this? Why are these “honorable men” of the Brutus type at the top of the social hierarchy? While Thorstein Veblen and Karl Marx have developed cogent analyses of inequality itself, neither has explained the origins of inequality in its break and separation from the original state of equality. I propose that this is a task for institutionalists, basing their argument on Veblen’s understanding of “institutions.”

Economics and Utopia: Why the Learning Economy Is not the End of History

ticularly poverty. He explains how poverty can be viewed as abnormality, need, or exclusion. Different policies derive from the different views. Fortman also explains that deregulation is a misnomer. When properly understood in the context of development, deregulation is actually re-regulation. In addition to much else of value, Fortman introduces the American reader (myself included) to a wide range of unfamiliar literature that should prove to be very helpful. The collection contains an index.

Clark after Haymarket

In the period 1887–1890, one observes a marked change in Clark’s position in a number of related areas. There is increasingly less argumentation based on divine law, this position eventually disappearing from the discussion altogether;1 now science, particularly that of Darwin, takes a dominant position. Second, Clark’s general theoretical perspective takes on a more conservative slant; it is increasingly less critical of prevailing arrangements and no longer promotes his supposedly ‘socialist’ solution to the problems then facing the United States economic order.

The March to Distribution

In the decade prior to the publication of his magnum opus, The Distribution of Wealth (1899), Clark developed and consolidated the various strands of the argument for which he is most famous — the marginal productivity theory of distribution. While one can trace the germ of this concept to his 1877 ‘The New Philosophy of Wealth’, it is not until the 1890 ‘The Law of Wages and Interest’ that we see a complete statement of the principle lying behind the theory.

The Distribution of Wealth

If one were to have read all Clark’s articles prior to 1899, one would find Distribution somewhat anti-climactic. The ‘big book’ which most economists associate with Clark’s entry into the top rank of economists of the time is largely a restatement of his argument as developed over the previous decade. Chapters 7 through 10 (the heart of the work) are drawn directly from his ‘Capital and Its Earnings’ (1888) and ‘Possibility of a Scientific Law of Wages’ (1889), while ‘Distribution as Determined by a Law of Rent’ (1891) and ‘A Universal Law of Economic Variation’ (1894) comprise the essence of Chapters 12 through 14. Indeed, some of the content is traceable to The Philosophy of Wealth period: Chapter 20 is a re-worked version of Chapters 7 and 8 of that work, and these were derived from articles written in 1883.

Clark, the Professionalization Process and the War Essays

From the late 1880s through the 1890s, economics became increasingly institutionalized as a discipline — a discipline established as a system of intellectual authority. We are here concerned only with the course of this development in the United States, Clark’s role in this development, and the ideological thrust represented by economists of Clark’s persuasion. While it is impossible (and improper) to tell the complete story of this unfolding drama in the context of this work, a cursory examination must be undertaken to allow the reader a sufficient basis from which to understand Clark’s actions and the relationship between them and his general theoretical outlook.1