Reflections on the Corporation as a Social Invention

Abstract

The corporation as an organizational form is an enormously productive social invention. Partly because of its success it is under increasing attack from various quarters, often under the guise of protecting investors from self-interested managers. Some of these attacks are successful simply because the corporation is a poorly understood entity. This paper discusses what the corporation is, what it is not, and how certain misconceptions about the corporate form are fostered by its critics as part of their attack.

Keywords: Social responsibility, survival, definition of corporation, corporate democracy, federal chartering, Corporate Democracy Act, corporate control, government involvement