ABSTRACT
Large corporate institutions clearly sit at the pinnacle of economic power, and wield enormous influence in the halls of government. But in neoclassical theory, especially in the much-discussed “microfoundations” of macroeconomics, the institutional complexity and behavioral autonomy of the firm is almost completely absent. In the typical model, the perfectly competitive representative firm passively maximizes profits. The firm is a mere repository of the technology for transforming inputs into output, and that technology is usually independent of any action of the firm or its managers.1
