This book considers Thorstein Veblen’s central preoccupation with the dark places of business enterprise, an integral part of the old institutional economics. Combining the contributions made by Karl William Kapp and Philip Mirowski, it proposes the systematization of an adjourned institutional theory of social costs of business enterprise useful for the analysis of contemporary crises.
The Dark Places of Business Enterprise explores the research potential of the theory of social costs for the analysis of actual business behavior in the current globalized privatization regime. It begins with a detailed outline of Veblen’s critique of business enterprise and market competition before illustrating the methodical enrichment of this approach through Kapp’s work. Finally, it concludes by proposing the integration of the Veblenian-Kappian approach with Mirowski’s theory of markets and business doubt manufacture. The resulting theory of social costs will shed light on the ubiquitous business control of society under the now dominant computer-based technological infrastructure.
This interdisciplinary foundation of the theory of social costs, encompassing knowledge from computer science and engineering to natural sciences, provides the tools required to analyze this great transformation.
"The strength of institutional economics is its ability to show how industries profit by shifting costs to society. These social costs of capitalism create the crises of today and should be front and centre in every debate." – Sebastian Berger, University of the West of England (UWE Bristol), UK
"This non-conformist book should invigorate the debate on the dark places of the pecuniary institutions – business enterprise and the market. Such central research topic has not yet received the critical attention it deserves. While also offering a comprehensive overview of neoclassical and neoliberal attempts to explain market failures, the book proposes a renewed knowledge-based institutional theory of social costs built upon the converging contributions of Veblen, Kapp and Mirowski. Its stimulating approach is perfectly timed to trigger a broad reorganization of the institutionalist research agenda after the digital revolution." – Michele Cangiani, Università Ca’ Foscari, Venezia, Italy
"If you are dissatisfied with the prevailing explanations of the origins and manifestations of economic power in contemporary capitalism, this is your book. Drawing mainly on the classical works of Veblen and Kapp, the two authors offer precious food for thought even to those who do not fully agree with all their statements." – Maurizio Franzini, Sapienza, University of Rome, Italy
List of figures
Introduction: critical institutionalism, market model failure, and the business control of society through cybernetic manipulation
1 Veblen’s dark places of business enterprise and the theory of social costs
2 Karl William Kapp’s critical theory of social costs: asset-specific cost-shifting, retardation of efficiency, and the paradox of social control
3 Neoclassical economics beyond externalities? Akerlof and Shiller’s Phishing for Phools and the theory of social costs
4 Digging into the dark places of business enterprise: revisiting the theory of social costs in the light of Mirowski’s institutional economics of knowledge
5 The darkest place of business enterprise: business surveillance, the financial crisis, and the swansong of the market in the information age