Economists and other thinkers have long thought about the nature of economic and political power in a capitalist system. One of the large concerns since the advent of the industrial economy has been the potential for producers and firms to wield power and influence and disrupt the economic system to their advantage. Adam Smith wrote in the Wealth of Nations that producers rarely gather together except to determine the course of events in their own favor. Economists have long regarded this as a difficult challenge to confront. The typical perfectly competitive market model assumes price taking as opposed to price making power for stability and equilibrium. Hayek talk about power as, "the capacity to achieve what one wants". He wants to contrast power from coercion. Hayek does not per se see a problem with power we can be put to good use. He uses the example of people coming together and submitting themselves to the power of a manager to do more together. ...
This blog has been setup to explore the ideas and philosophy of the American institutional economist John R. Commons.