chapter  9
13 Pages

Technology II

Introduction In Chapter 8 , we dealt with the general problem of the interaction of technology and business enterprise, which institutional economics considers fundamental. In this context, we have been concerned with: (1) technology as an institution, with manifest ramifi cations on the economy and the socio-cultural situation; (2) the imperatives of modern industrial techniques, as manifested in the machine process; and (3) the ecological and socio-economic confl icts and contradictions resulting from the actualization of modern technology in a system of business enterprise. The current chapter continues this analysis of the interaction of technology and business enterprise; however, unlike the preceding chapter, it describes in greater detail the manner in which institutional economics views the operation of the system of business enterprise under the impact of technical change, and examines the more concrete problems created by the interaction of the two: how business enterprise, under the regime of the corporate form of business organization and corporate fi nance, gives rise to an infl ation of all monetary values, to the concentration and centralization of decision-making, to sales promotion and publicity, to tacit alliances, and to the administration and planning of production and sales. The result of this interaction changes the structure of markets, of the economy, and of society as a whole, and institutional economics does not view the emergence of these and related features of modern industrial societies as isolated phenomena; instead it analyzes their origins and signifi cance within a generalized account of the manner in which the interaction of business enterprise and technology leads to a cumulative expansion, and a recurring threat to the capitalized earning capacity and solvency of the corporation. Our fi rst task, then, will be to outline the role which the corporation, as the master organization of modern industrial society, plays in this concatenation of technology and business enterprise.