Economic Calculation in the Corporate Commonwealth on Feed 44

C4SS Feed 44 presents “Economic Calculation in the Corporate Commonwealth” from the book Markets Not Capitalism, written by , read by Stephanie Murphy and edited by Nick Ford.

Try as he might, Mises could not exempt the capitalist corporation from the problem of bureaucracy. One cannot define bureaucracy out of existence, or overcome the problem of distributed knowledge, simply by using the word “entrepreneur.” Mises tried to make the bureaucratic or non-bureaucratic character of an organization a simple matter of its organizational goals rather than its functioning. The motivation of the corporate employee, from the CEO down to the production worker, by definition, will be profit-seeking; his will is in harmony with that of the stockholder because he belongs to the stockholder’s organization.

By defining organizational goals as “profit-seeking,” Mises—like the neoclassicals—treated the internal workings of the organization as a black box. In treating the internal policies of the capitalist corporation as inherently profit-driven, Mises simultaneously treated the entrepreneur as an indivisible actor whose will and perception permeate the entire organization. Mises’s entrepreneur was a brooding omnipresence, guiding the actions of every employee from CEO to janitor.

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