Productive Systems and the Structuring Role of Economic and Social Theories

The institutions of productive systems are structured by mutual interests and relative power. Securing mutually beneficial cooperation in production requires resolving distributional differences. These objectives are secured in liberal economic theory by the working of markets which mediate the power of individuals and reward individual success. The centrality of individuals and hierarchies in market theory contrasts with developments in labour management theory which identifies group activity and decentralised responsibility as productive factors and organisations as unitary. This neglects the separate interest that productive partners have and the role of institutions in resolving conflicts in productive systems to secure productive co-operation. JEL Codes: G34,, J51, J53, L22, L23, M12