On the Financial Business Cycle Theory of J. R. Commons: Institutional Economics of Incorporeal Property and Intangible Property

Abstract

:The perspective of a legal political economy was a main feature of J. R. Commons’ Institutional Economics. He interpreted the development of a capitalist economy as the evolution of legal institutions. The most important legal institutions supporting a capitalist economy are property rights. The definition of property has been enlarged from corporeal property to include incorporeal property and intangible property. Commons contrasts the law of incorporeal property with that of intangible property. He argues two quite opposite economic relationships: one is the creditor‐debtor relationship and the other is the seller‐buyer relationship. This study argues Commons’ financial business cycle theory using these two opposite concepts of property.