Legal Foundations Of Capitalism Research Articles

The Place of Law In Political Economy. J.R.Commons’ Legal Foundations of Capitalism at 100: A Retrospective Article

Abstract This article revisits J.R. Commons’ The Legal Foundations of Capitalism (LFC), published 100 years ago, from an interdisciplinary point of view. It explains and contextualizes Commons’ approach, introduces key concepts and core arguments of the book, and links these to contemporary scholarly work and debates. The aim is to make Commons’ ideas more accessible and to demonstrate their continued relevance for discussions on the role of law in political economy.

John R. Commons and the Moral Foundations of American Labor Law

John R. Commons’ Legal Foundations of Capitalism (1924) is relevant for American labor law because it represented in some ways the pinnacle of the Progressive Movement at the beginning of the twentieth century. Commons believed that markets were not automatically self-correcting so that workers would not necessarily be treated fairly. This view explains why he was a founder of institutional economics, as opposed to a supporter of neoclassical economics. Commons also discussed the limitations of the American legal system in favoring big business rather than labor unions. In this essay, I discuss Commons’ criticisms, supplemented by contemporary scholars’ work. In modern society, procedures are often understood better than the goals that they are meant to facilitate. This means that many writers in the Law and Economics field are no longer comfortable in conceptualizing how quantitative measures of value can be usefully combined with qualitative measures of value, resulting in justice. The ideas of John R. Commons as a founder of institutional economics are discussed as a remedy for this.

An Analysis of J.R. Commons's Changing Views on the Role of Sovereignty in the Political Economy

This article distills the economic and current significance contained in the political economy of J.R. Commons. It compares descriptions of his three main works that discuss “sovereignty”: A Sociological View of Sovereignty (SVS), Legal Foundations of Capitalism (LFC), and Institutional Economics (IE). Through this comparison, we find that the role of sovereignty in his theory changed dramatically. First, in the period from SVS (1899–1900) to LFC (1924), the theory of sovereignty changes significantly from the standpoint of natural rights, which imply permanence of privileged customs, to “pragmatic philosophy” of the courts, in which laws are relevant to customs at certain times and places. Second, from the manuscripts of IE (1927–1928), sovereignty is defined as comprising part principles, which relate to each other and make up the whole principle, willingness. In other words, Commons views sovereignty as one perspective, which in turn has a high capability of explaining the socioeconomic system. Additional descriptions of IE (1934) derived from its original manuscripts repeatedly emphasize the “power” of economic concerns that are equal to or exceed the power of the state, as well as the importance of the “function” of sovereignty in pragmatic investigations of economic disputes. We distill the economic and current significance of IE. First, the value theory that constructs values institutionally and collectively starts from an analysis of sovereignty and joint evaluations. Second, sovereignty cannot be separated from an analysis of economic transactions. Third, this paper concretely shows elements of a “deliberate space” in which sovereignty and economic interests act in concert. J.R. Commons’s IE sets out specific knowledge on the interface between sovereignty and economic interests, and serves as a useful tool in reconsidering the organ of sovereignty. JEL: 160, B110;

Contracting the Commonwealth: John R. Commons and Neoliberal Financial Crises

:This essay adapts Commons’s model of the legal foundations of capitalism to the peculiar circumstances of the neoliberal era. So doing provides a lens for seeing the steady erosion of state capacity to protect the commonwealth, even in nations with hegemonic currency. Our focus here is on the links between the “triple crisis” of the 1980s and the subprime and foreclosure crisis of the 2000s. We show how Brady bonds, after being used to resolve the Latin American debt crisis in the 1980s, provided a governing contractual context for subprime lending, and as such constrained the capacity of the U.S. government to respond to a crisis that preyed on the vulnerable, undercut community life, and contracted the commonwealth.

Asia's Legal Systems in the Wake of the Financial Crisis: Can the Rule of Law Carry any of the Weight?

People have long been interested in the relationships between legal systems and economic performance, and have approached these issues in many different ways. The original American institutional economics produced such works as Ely’s Property and Contract in Their Relations to the Distribution of Wealth (Ely 1914) and Commons’ The Legal Foundations of Capitalism (Commons 1924). That law should have occupied a central place in their thinking about economics should come as no surprise, since the study of legal institutions was key to the German historical approach to political economy (Cohn 1894), which strongly influenced many American institutionalists (Kloppenberg 1997; Hovenkamp 1991). For Weber, of course, legal, political and economic organization were intimately related, and the rise of a specific style of legality (‘formally rational’ in his terms) was closely tied to the rise of modern, industrial capitalism (Weber 1968; Trubek 1972). And although he seems not to have elaborated on the theme, law, or rather the lack of a functioning legal system, also played a role in the theorizing of the economic historian Alexander Gerschenkron. In explaining why the modernizing Russian state of the 1890s had to assume capital accumulation and allocation functions that had been successfully performed by private universal banks in Germany, Gerschenkron speculated that ‘no bank could have successfully engaged in long-term credit policies in an economy where fraudulent bankruptcy had been almost elevated to the rank of a general business practice’ (Gerschenkron 1965).

John R. Commons and the Foundations of Institutional Economics

(2003). John R. Commons and the Foundations of Institutional Economics. Journal of Economic Issues: Vol. 37, No. 3, pp. 547-576.

The Social Psychological Underpinnings of Commons’s Institutional Economics: The Significance of Dewey’s Human Nature and Conduct

(1997). The Social Psychological Underpinnings of Commons’s Institutional Economics: The Significance of Dewey’s Human Nature and Conduct. Journal of Economic Issues: Vol. 31, No. 4, pp. 881-916.

The Social Gospel, Ely, and Commons’s Initial Stage of Thought

As John R. Commons rose out of the 1890s to success in the twentieth century as an institutional economist, his thought evolved through several stages. Much is known about the last stages that include his ideas in his Legal Foundations of Capitalism and Institutional Economics. His beginnings, however, lie in darkness, partially illuminated by his autobiography, Myself [1934], and the research of Dorfman [1949; 1965a; 1965b], Harter [1962], and Mayhew [1987]. These works reveal inter alia that he then had strong religious convictions. Questions arise. When was the initial stage? Did his religious beliefs affect his economic thought? Did his ideas then make up a coherent whole? Is the initial stage significant: does it make more understandable the later stages of his thought? This essay argues several theses. First, the initial stage ran from 1882 until 1894, a period when Commons entered the social gospel movement and became Richard T. Ely's disciple and protege. Second, Commons's social gospel principles were fundamental: they imparted coherence to his work, creating his social welfare criteria, leading him into Christian socialism and Christian sociology, affecting his political economy and causing it to attend to the role of institutions and the social relations they enforce, and, via all of the foregoing, determining his policy proposals and his plan to enact them. Third, this initial stage is significant, for it can explain his subsequent work from 1894 to 1899, and it can roughly account for parts of the post-1899 stages.

The Legal Foundations of Capitalism and the Labor Problem

<i>The Legal Foundations of Capitalism</i> and the Labor Problem

Book Reviews : Legal Foundations of Capitalism. By JOHN R. COMMONS. (Madison: The University of Wisconsin Press. 1957. Pp. x, 394. $6.00 and $1.95, paperback.)

Book Reviews : Legal Foundations of Capitalism. By JOHN R. COMMONS. (Madison: The University of Wisconsin Press. 1957. Pp. x, 394. $6.00 and $1.95, paperback.)

Legal Foundations of Capitalism

Legal Foundations of Capitalism

Legal Foundations of Capitalism.

Legal Foundations of Capitalism.

Commons's Legal Foundations of Capitalism

Commons's Legal Foundations of Capitalism

Legal Foundations of Capitalism

Legal Foundations of Capitalism