Book contents
- Frontmatter
- Contents
- List of figures
- Acknowledgments
- Introduction: the wealth of three nations
- PART I Economic institutions and economic performance
- PART II Intellectual foundations and intellectual constraints
- 4 The theory and history of capitalist development
- 5 The making of the market mentality
- PART III The “marvels of the market” versus the “visible hand”
- PART IV Overcoming intellectual constraints
- Index
5 - The making of the market mentality
Published online by Cambridge University Press: 01 April 2010
- Frontmatter
- Contents
- List of figures
- Acknowledgments
- Introduction: the wealth of three nations
- PART I Economic institutions and economic performance
- PART II Intellectual foundations and intellectual constraints
- 4 The theory and history of capitalist development
- 5 The making of the market mentality
- PART III The “marvels of the market” versus the “visible hand”
- PART IV Overcoming intellectual constraints
- Index
Summary
The neglect of history
The twentieth-century experiences of successful capitalist development and relative economic decline reveal that organizational coordination has increasingly replaced market coordination in the value-creation process. Within the capitalist enterprise, planned coordination of the specialized division of labor has become increasingly important for the development and utilization of resources. Within national industries, enterprises with greater organizational capability have been able to gain and sustain competitive advantage not only through the development and utilization of resources within the enterprise, but also through privileged access to external resources both within and beyond the boundaries of the national economies in which they are based. Within successful national economies, the state has promoted the competitiveness of particular industries by investing in resources such as education, communications, and financial institutions on which the nation's business enterprises can draw in building their organization-specific productive capabilities.
In the early decades of this century, the managerial revolution in U.S. industry overcame the competitive advantage of the British economy based on market-coordinated industry. In the post-World War II decades, even more profound organizational coordination has enabled Japanese industry to surpass U.S. industry in an ever-broadening array of pursuits. As argued in Chapter 1, Japanese planned coordination is not entirely new; it can be viewed as a more integrated elaboration of the managerial enterprise that brought U.S. industry to economic dominance in the first half of this century.
- Type
- Chapter
- Information
- Business Organization and the Myth of the Market Economy , pp. 147 - 188Publisher: Cambridge University PressPrint publication year: 1992