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Post-Keynesian Theory of Business Enterprise and the Veblenian´s Approach: Are there commonalities?

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  • Parada, Jairo

Abstract

The main objective of this paper is to explore the possible common grounds, divergences and complementarities between the Veblenian’s approach on the Theory of Business Enterprise followed by Institutional economists, and the modern Post Keynesian Micro theory on Business enterprise. Due to the dispersion and lack of systematization of Institutional Economics regarding this body of theory, compared with the Post-Keynesian theory of the firm, the main efforts of this paper will be dedicated to a short survey of the Institutional approach. In the second section of the paper I review the basic ideas presented in Veblen’s main contributions on this area regarding business enterprises (industrial process, main principles, role of credit, ownership structure, the legal framework, the price behavior and the cultural incidences). Then, I make a comparison with the main theoretical results that modern postkeynesian vision has developed regarding structure of production, costing, pricing, investment, and competition and market governance . I claim that even though there are commonalities and some minor divergences between the two approaches, complementarities among them are more relevant, although the main areas of research have been somewhat different. I end with some conclusions that underline possible areas of cooperation between these two schools of economic thought within the heterodox paradigm.

Suggested Citation

  • Parada, Jairo, 2008. "Post-Keynesian Theory of Business Enterprise and the Veblenian´s Approach: Are there commonalities?," MPRA Paper 16768, University Library of Munich, Germany, revised 10 Jul 2008.
    • Handle: RePEc:pra:mprapa:16768
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    References listed on IDEAS

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    1. John F. Henry & L. Randall Wray, 1998. "Economic Time," Macroeconomics 9811004, University Library of Munich, Germany.
    2. Janet T. Knoedler, 1995. "Transaction Cost Theories of Business Enterprise from Williamson and Veblen: Convergence, Divergence, and Some Evidence," Journal of Economic Issues, Taylor & Francis Journals, vol. 29(2), pages 385-395, June.
    3. C. N. Pitelis, 1998. "Transaction Costs and the Historical Evolution of the Capitalist Firm," Journal of Economic Issues, Taylor & Francis Journals, vol. 32(4), pages 999-1017, December.
    4. Veblen, Thorstein, 1904. "Theory of Business Enterprise," History of Economic Thought Books, McMaster University Archive for the History of Economic Thought, number veblen1904.
    5. John R. Munkirs & James I. Sturgeon, 1985. "Oligopolistic Cooperation: Conceptual and Empirical Evidence of Market Structure Evolution," Journal of Economic Issues, Taylor & Francis Journals, vol. 19(4), pages 899-921, December.
    6. Marc Lavoie, 1992. "Foundations of Post-Keynesian Economic Analysis," Books, Edward Elgar Publishing, number 275.
    7. Dow, Sheila C., 2000. "Prospects for the Progress of Heterodox Economics," Journal of the History of Economic Thought, Cambridge University Press, vol. 22(2), pages 157-170, June.
    8. Janet T. Knoedler, 1990. "As Much Technological As Pecuniary: Turn-Of-The-Century Combinations In Three Major Industries," Journal of Economic Issues, Taylor & Francis Journals, vol. 24(2), pages 397-404, June.
    9. William M. Dugger, 1980. "Corporate Bureaucracy: The Incidence of the Bureaucratic Process," Journal of Economic Issues, Taylor & Francis Journals, vol. 14(2), pages 399-409, June.
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    Cited by:

    1. Murray, Michael/ M J, 2011. "The Making of a Good Society: Economic Freedom, Instrumentalism, and Government Control," MPRA Paper 28888, University Library of Munich, Germany.
    2. Murray, Michael/ M J, 2011. "The Making of a Good Society: Lowe’s Instrumental Method and the Pursuit of Full Employment," MPRA Paper 39570, University Library of Munich, Germany.

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    More about this item

    Keywords

    Theory of the Firm; Postkeynesian Economics; Institutional Economics.;
    All these keywords.

    JEL classification:

    • D2 - Microeconomics - - Production and Organizations
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics
    • B5 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches

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