Berle and Veblen: An Intellectual Connection
Charles R.T. O'Kelley
Adolf A. Berle, Jr. Center on Corporations, Law and Society, Seattle University School of Law; M.E. Kilpatrick Chair of Corporate Finance and Securities Law Emeritus, University of Georgia School of Law
April 15, 2011
Seattle University Law Review, Forthcoming
This article highlight the need for further research into the connection between Berle and Means’ The Modern Corporation and Private Property (Modern Corporation) and the work of Thorstein Veblen, the father and intellectual inspiration of institutional economics. Much has been and continues to be written about Berle in legal journals, but Veblen is almost entirely ignored. Thus, while the connection between Veblen and Modern Corporation is indisputable, the meaning of that connection has not been explored in any depth. The article provides a framework for thinking about the nature of Veblen’s influence on Modern Corporation and provides an initial account of how Veblen’s work may help us understand what Berle intended to convey in Modern Corporation.
The article draws from Veblen’s own writings to provide a sketch of his life’s work, in order to provide an access point for readers. Then, I place Modern Corporation in the context of Veblen’s work. In so doing I will suggest that Modern Corporation should be considered a work of evolutionary economic science as Veblen used that term. The article details Veblen’s vision of modern economics as an evolutionary science, and highlights Veblen’s twenty-five year attempt to create an evolutionary economic account of American capitalism, with particular emphasis on Veblen’s seminal insights concerning the modern corporation and separation of ownership and control. The article concludes with re-interpretation of Modern Corporation in light of Veblen’s body of work.
Number of Pages in PDF File: 33
Keywords: Berle, Veblen, Institutional Economics, Legal History, Corporate Governance, Separation of Ownership and Control, Shareholder Primacy, New Deal, Rathenau, Sociology, Law and Society, Neo-Classical, Utility Maximizing, Darwin, Marshall, Smith, Galbraith, Means, Social Institution, Laissez-FaireAccepted Paper Series
Date posted: April 18, 2011
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