Abstract
The objective of this chapter is to discuss, perhaps to answer, such questions as: of what significance is it for the corporation to be thought of as a person? Of what significance is it for the corporation to be treated as a person? The focus of the chapter, then, is not on the corporation as a person as such but on the idea of the corporation as a person and its social role. To this end, an analysis of more universal applicability is brought to bear on this question. There are therefore two levels of discussion: the general analysis and its application to the idea of the corporation as a person. The argument is that ideas (such as the idea of the corporation as a person) are inexorably embodied in legal definitions in such ways as to influence our view of the world and therefore economic and political behaviour, policy, and performance, and that in consequence of this recognition, the embodiment of certain ideas in law becomes an object of control.
Originally published in Warren J. Samuels and Arthur S. Miller (eds), Corporations and Society: Power and Responsibility (Westport: Greenwood Press, 1987), pp. 113–29.
The author is indebted to Arthur S. Miller, A. Allan Schmid, James D. Schaffer, and Robert A. Solo for comments on an earlier draft of this chapter.
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Notes
The concept of the corporate system is developed in A. A. Berle and G. C. Means, The Modern Corporation and Private Property (New York: Macmillan, 1932); Berle, ‘Modem Functions of the Corporate System’, Columbia Law Review, vol. 433 (1962);
G. C. Means, The Corporate Revolution in America (New York: Collier, 1962);
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See also Alvin Johnson, ‘Essays in Social Economics’, 1 (New York: New School For Social Research, 1954),
and M. G. Smith, Corporations and Society (London: Duckworth, 1974) (corporations as established social units).
See Novak, ‘God and Man’, and, revealingly, Toward a Theology of the Corporation (Washington, D.C.: American Enterprise Institute, 1981);
see also M. Novak and J. W. Cooper (eds), The Corporation: A Theological Inquiry (Washington, D.C.: American Enterprise Institute, 1981).
See W. J. Samuels, Pareto on Policy (New York: Elsevier, 1974).
K. E. Boulding, The Image (Ann Arbor, MI: University of Michigan Press, 1956) (decisions as choices among alternative perceived images of the future).
See, e.g., J. R. Commons, Legal Foundations of Capitalism (New York: Macmillan, 1924);
M. Horwitz, The Transformation of American Law (Cambridge: Harvard University Press, 1977);
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P. C. Sederberg, The Politics of Meaning (Tucson, AZ: University of Arizona Press, 1984);
P. L. Berger and T. Luckmann, The Social Construction of Reality (Garden City, NY: Doubleday, 1966);
Samuels and Mercuro, ‘The Role and Resolution of the Compensation Principle in Society: Part One — The Role’, Research in Law and Economics, vol. 1 (1979), p. 157.
Fraser, ‘The Corporation as a Body Politic’, Telos, vol. 57 (1983), p. 5,
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County of San Mateo v. S. Pac. R. R. Co., Federal Reporter, vol. 13 (1882), pp. 722, 743–4, 747–8 (see also, Sawyer, C. J., concurring opinion, at 757ff);
County of Santa Clara v. S. Pac. R. R. Co., Federal Reporter, vol. 18 (1883) pp. 385, 402–5; Pembina Consolidated Silver Mining and Milling Co. v. Pennsylvania, 125 U.S. 181, 189 (1888).
Clark, ‘Trusts, Present and Future’, Independent, vol. 51 (20 April 1899), pp. 1076, 1079, 1080.
Clark, ‘The Society of the Future’, Independent, vol. 53 (18 July 1901), pp. 1649, 1650. Even Justice Field noted the Court’s awareness ‘of the opinion prevailing throughout the community that the railroad corporations of the state, by means of their great wealth and the numbers in their employ, have become so powerful as to be disturbing influences in the administration of the laws’.
County of San Mateo v. S. Pac. R. R. Co., Federal Reporter, vol. 13 (1882), pp. 722, 730.
F. X. Sutton et al., The American Business Creed (Cambridge, MA: Harvard University Press, 1956);
R. J. Monsen, Modern American Capitalism (Boston: Houghton Mifflin, 1963);
and E. S. Mason, ‘The Apologetics of Managerialism’, Journal of Business, vol. 31 (1958), p. 1.
On the putative inadequacy of ‘individualism’, see the works of Novak, n. 2 above; M. Janowitz, ‘Reconstruction of Patriotism’, Education for Civic Consciousness (Chicago: University of Chicago Press, 1983);
and R. N. Bellah et al., Habits of the Heart: Individualism and Commitment in American Life (Berkeley, CA: University of California Press, 1985).
J. A. Schumpeter, Capitalism, Socialism, and Democracy, 3d edn (New York: Harper, 1950).
See also W. J. Samuels, ‘A Critique of Capitalism, Socialism and Democracy’, in R. D. Coe & C. K. Wilber (eds), Capitalism and Democracy: Schumpeter Revisited (Notre Dame: University of Notre Dame Press, 1985).
C. E. Lindblom, Politics and Markets (New York: Basic Books, 1977), pp. 170ff. 23. Novak, ‘God and Man’, at 12, 28, et passim.
J. K. Galbraith, The New Industrial State (Boston: Houghton Mifflin, 1967).
F. H. Knight, Risk, Uncertainty and Profit (Boston: Houghton Mifflin, 1921), p. 78.
James K. Galbraith, ‘Galbraith and the Theory of the Corporation’, Journal of Post-Keynesian Economics, vol. 7 (1984), pp. 43, 59.
‘One of the more striking features of Smith’s argument is in fact the link which he succeeded in establishing between the form of economy prevailing (i.e. the mode of earning subsistence) and the source and distribution of power or dependence among the classes of men which make up a single “society” .... We also find here a form of property which can be accumulated and transmitted from one generation to another, thus explaining a change in the main sources of authority as compared to the previous period.’ R. H. Campbell and A. S. Skinner, ‘General Introduction’, in Adam Smith, An Inquiry into the Nature and Cause of the Wealth of Nations, vol. 1 (New York: Oxford University Press, 1976), pp. 12–13.
F. A. Walker, quoted in J. P. Munroe, A Life of Francis Amasa Walker (New York: Holt, 1923), p. 254.
For example, although the precise relationship (if there is one) between the institution of the corporation and the propensity to save is uncertain, there have been at least two conflicting views. According to one, the institution of the corporation reduces risk and facilitates the accumulation of capital, and thus abets the propensity to save. Taussig, ‘Is Market Price Determinate?’ Quarterly Journal of Economics, vol. 35 (1921), pp. 394, 408–9. According to the other, corporate organization tends to destroy ‘one of the strongest motives for saving’ by generating a permanent fund of capital and reducing risk. A. Johnson, Essays, at 61. 30.
F. A. Hayek, Studies in Philosophy, Politics and Economics (Chicago: University of Chicago Press, 1967), pp. 300ff.
For quite different views on corporate reform, see H. Manne, ‘Our Two Corporation Systems: Law and Economics’, Virginia Law Review, vol. 53 (1967), p. 259;
Symposium, Quarterly Review of Economics and Business, vol. 24 (1984); Samuels, System of Power; TRB, ‘Productive Predators’, New Republic, vol. 4, 25 March 1985, at p. 4; and ‘Four Ways to Change the Corporations’, Nation, 15 May 1982, p. 575.
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© 1992 Warren J. Samuels
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Samuels, W.J. (1992). The Idea of the Corporation as a Person: On the Normative Significance of Judicial Language. In: Essays on the Methodology and Discourse of Economics. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-12371-1_3
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