The Corporation and the Market

In a recent series of articles on this site, Michael Black argued that the Corporation can only be understood theologically – further, that the modern economic crisis is a crisis of the Corporation. But what about the "Market", which is the other big player in the economic game, along with the State and the Corporation?

In economic theory the corporation is a monstrous, if only temporary, aberration. It stops the march of contractual transactions and therefore is by definition “inefficient”. And economic theory is quite correct: the corporation always costs more than a set of equivalent markets. The market, after all, has no overheads, no supervisory management, no administration. If this is all that we see, we can only bemoan the fact, as many managers as well as corporate critics do, that the corporation continues in existence at all. What ever the Corporation is for, it is not for providing lower-cost products and services. So what is it for, in economic terms?

The Corporation creates economic value. Markets establish prices, not value. The Corporation determines what constitutes value – speed, precision, beauty, harmony, or any of an infinite number of other criteria – and persuades the participants in the Market

Theology of the corporation

This term in Oxford, our colleague and adviser Michael Black will be giving a series of important lectures at Blackfriars. The corporation is a dominant institution of modern society. Our economic, political and cultural life is almost inconceivable without the corporation as the legal, commercial and financial foundation for human association. And it is an institution that affects us all intimately as participants, partners, observers, and victims. Yet it is an institution that is frequently misunderstood in terms of both its history and its function in society. What ‘good’ does the corporation actually provide? Are there defensible reasons for the evolution corporate law and the conventions of corporate life? What does it mean to be ethical as part of the corporate way of being? These lectures will explore the history, practices, and prospects of the corporation from a theological perspective. Theology, it will be shown, is not something extrinsic to the corporation, yet another point of view among many from which to analyse the corporate character. Rather, theology is a basic constituent of the social relation which we call corporate – in its design, in its legal expression, and in its particular logic the corporation is a product of theological categories of thought. Theology therefore is able to help uncover the hidden form and potential of corporate life, and to suggest fresh approaches to its membership, management, regulation and evaluation. Students of law, economics, and business as well as theology may find the material relevant to their courses of study and are welcome to attend.