Organization Theory

Description

Published in 2008 by the author.

This book applies the economic principles of individualist anarchism, as developed in Studies in Mutualist Political Economy, to the study of the large organization. It integrates the insights of mainstream organization theory into that framework, along with those of more radical thinkers like Ivan Illich, Paul Goodman, and R.A. Wilson. Part One examines the ways in which state intervention in the market, including subsidies to the inefficiency costs of large size and regulatory protection against the competitive consequences of inefficiency, skews the size of the predominant business artificially upward to an extent that simply could not prevail in a free market. Part Two examines the effects of such large organizational size on the character of the system as a whole. Part Three examines the internal pathologies and contradictions of organizations larger than a free market could support. And Part Four surveys the potential building blocks of an alternative, decentralized and libertarian economic order.

As long as free-market advocates continue to embrace a theory of the firm that is contradicted by the daily experience of millions of ordinary people, they will continue to be regarded as apologists for big business – and deservedly so. Carson does a brilliant job of showing how the swollen, hierarchical, exploitative firms that dominate our economy are the product not of the free market but of systematic government intervention on behalf of the corporate elite. Carson’s work offers a compelling alternative to both the right-wing package deal (embrace predatory capitalism in order to get the benefits of free markets) and the left-wing package deal (reject free markets in order to avoid the evils of predatory capitalism), and lays out an inspiring blueprint for workers and consumers to take back power from the bureaucrats and plutocrats. – Roderick T. Long, professor of philosophy, Auburn University

Kevin Carson’s book touches many of the key subjects regarding the transformation of our political economy into a post-capitalist, ‘peer to peer’ logic, examining not just the organisational logic of productive organizations, but also the transformation in the nature of machinery and capital goods (which are becoming more and more distributed and miniaturized) and the new culture of cooperation that is taking root in open design communities. I don’t think there is an equivalent book that look so seriously and deeply into the real potential of social and economic transformation, anchored in a detailed study of contemporary productive capacities. – Michel Bauwens, P2P Foundation

Carson brings so-called ‘economies of scale’ down from the clouds so that we can compare them with different economies of different scales we might otherwise have enjoyed of states and corporations had not so helpfully inflicted a particular pattern of artificial bigness on us for nearly 200 years. He analyzes in great detail the top-down bossism of large-scale organizations. Conversant with a wide range of literature on management questions, he applies the Austrian theorem on economic calculation to a critique of corporate capitalism – an area where Austrians fear to tread. At the same time, Carson sketches out an alternate set of arrangements – without large-scale accumulations of political-economic power. All who have followed this book’s emergence will be very happy to see it in its final form; not least because of the work’s systematic and synoptic vision, which brings empirical reality into focus in reltion with the relevant theory. – Joseph Stromberg, Independent Institute

Kevin Carson’s new book offers another remarkable contribution to the theory of the freed market, and his defense of cottage industry and cooperative organization strikes a powerful blow against the ideological underpinnings of Progressive managerialism and state capitalism – an ideology shared by the statist Left and Right, and by all too many libertarian apologists for actually-existing capitalism. In the individualist tradition we have written a great deal about the need for consensual and respectful free association, but not nearly enough about just what our organizations, networks, and cooperative projects might look like in a world free from the coercion of the State; Carson argues exhaustively and persuasively for a vision of a cooperative, localized, green and durable economy – a vision which calls libertarians back to our historical roots in the radical (anarchistic Left), while prodding us forward to a new and fuller understanding of the full social and economic implications of radical freed-market ideas. – Charles Johnson, Molinari Institute

Kevin A. Carson is a contemporary mutualist author and a prolific writer on subjects including free-market anti-cap­it­al­ism, the in­div­idualist anarchist tradition, grassroots technology and radical unionism. He is the author of ”The Iron Fist Behind the Invisible Hand”, Studies in Mutualist Political Economy, Organization Theory: A Libertarian Perspective and The Homebrew Industrial Revolution. He keeps a blog at mutualist.blogspot.com and frequently publishes short columns and longer research reports for the Center for a Stateless Society (c4ss.org).

Contents

• Preface

Part One: State Capitalist Intervention in the Market

• A Critical Survey of Orthodox Views on Economy of Scale
  • Cross-Ideological Affinity for Large-Scale Organization
  • Chandler, Galbraith, and Push Distribution
  • Williamson on Asset-Specificity
  • Appendix A. Economy of Scale in Development Economics
• A Literature Survey on Economies of Scale
  • Economies of Firm Size
  • Economies of Plant Size
  • The Comparative Significance of Scale Economies and Organizational Efficiency
  • Increased Distribution Costs
  • The Link Between Size and Innovation
  • Economy of Scale in Agriculture
  • Conclusion
• State Policies Promoting Centralization and Large Organizational Size
  • The Corporate Transformation of Capitalism in the Nineteenth Century
    • The Nineteenth Century Corporate Legal Revolution
    • Subsidies to Transportation and Communication Infrastructure
    • Patents and Copyrights
    • Tariffs
  • Twentieth Century State Capitalism
    • Cartelizing Regulations
    • Tax Policy
    • The Corporate Liberal Pact With Labor
    • The Socialization of Corporate Cost
    • State Action to Absorb Surplus Output
    • Neoliberal Foreign Policy

Part Two: Systemic Effects of Centralization and Excessive Organizational Size

• Systemic Effects of State-Induced Economic Centralization and Large Organizational Size
  • Radical Monopoly and Its Effects on the Individual
  • Systemic Effects on Institutional Culture
  • The Large Organization and Conscript Clienteles
  • The New Middle Class and the Professional – Managerial Revolution
  • Postscript: Crisis Tendencies
  • Appendix. Journalism as Stenography
    1. Scott Cutlip
    2. Justin Lewis
    3. Sam Smith
    4. Harry Jaffe
    5. The Daily Show
    6. Brent Cunningham
    7. Avedon Carol

Part Three: Internal Effects of Organizational Size Above That Required for Optimum Efficiency

• Knowledge and Information Problems in the Large Organization
  • The Volume of Data
  • The Distortion of Information Flow by Power
  • Conclusion and Segue to Chapter Six
  • Appendix. The NHS’s IT Program as an Example of Systematic Stupidity
• Agency and Incentive Problems within the Large Organization
  • Introduction
  • Mainstream Agency Theory
  • Radical Agency Theory
  • Summary
  • Toilet Paper as Paradigm
• Economic Calculation in the Corporate Commonwealth (the Corporation as Planned Economy)
  • The Divorce of Entrepreneurial from Technical Knowledge
  • Hayek vs. Mises on Distributed Knowledge
  • Rothbard’s Application of the Calculation Argument to the Private Sector
  • Conclusion
  • Appendix. “The End of the Quarter Shuffle”
• Managerialism, Irrationality and Authoritarianism in the Large Organization
  • The Corporate Form and Managerialism
  • Self-Serving Policies for “Cost-Cutting,” “Quality” and “Efficiency”
  • The Authoritarian Workplace: Increased Hierarchy and Surveillance
  • Authoritarianism: Contract Feudalism
  • Authoritarianism : The Hegemony of “Professionalism”
  • Motivational Propaganda as a Substitute for Real Incentives
  • Appendix A. Blaming Workers for the Results of Mismanagement
    1. Senators Were Warned of Lexington Air Controller Understaffing
    2. Dian Hardison. “I F—ing Warned Them!”
    3. MSHA Makes The “Wrong Decision” To Blame Workers For Accidents
    4. Labor Relations in the Health Care Industry for Nurses
  • Appendix B. Corporate Rhetoric vs. Corporate Reality: The Case of “Chainsaw Al” Dunlap
• Special Agency Problems of Labor (Internal Crisis Tendencies of the Large Organization)
  • Introduction
  • The Special Agency Problems of Labor
  • Labor Struggle as Asymmetric Warfare
  • The Growing Importance of Huma n Capital : Peer Production vs . the Corporate Gatekeepers
  • Austrian Criticism of the Usefulness of Unions
  • Appendix A. Sabotage in a London Nightclub: A Case Study
  • Appendix B. Yochai Benkler on Open – Mouth Sabotage : Diebold and Sinclair Media as Case Studies in Media Swarming
  • Appendix C. DeCSS as an Example of Media Swarming
  • Appendix D. Open-Mouth Sabotage, Cont.: Alisher Usmanov as a Case Study in Media Swarming
  • Appendix E. Open Mouth Sabotage, Cont.: Wikileaks as a Case Study in Media Swarming
  • Appendix F. Stupid White Men as a Case Study in Media Swarming
• Attempts at Reform from Within: Management Fads
  • New Wine in Old Bottles
  • Lip Service and Business as Usual
  • Management by Stress
  • Dumbing Down
  • Conclusion and Segue to Part Four
  • Appendix. The Military Origins of Quality Control

Part Four: Conjectures on Decentralist Free Market Alternatives

• The Abolition of Privilege
  • Reciprocity
  • Privilege and Inequality
  • Specific Forms of Privilege, and the Effect of Their Abolition
    1. The Credit Monopoly
    2. Artificial Property Rights in Land
    3. Patents and Copyrights
    4. Occupational Licensing and Safety Codes
  • Appendix. Reciprocity and Thick Libertarianism
• Structural Changes: The Cost Principle
  • Introduction
  • Peak Oil and the “Long Emergency”
  • The Scale of Possible Savings on Energy Inputs
  • Path Dependency and Other Barriers to Increased Efficiency
  • The Cost Principle and the Work-Week
  • The Cost Principle and Local Autonomy
• Dissolution of the State in Society
  • Revolution vs. Evolution
  • Dialectical Libertarianism and the Order of Attack
  • The “Free Market” as Hegemonic Ideology
  • Gradualism and the “Magic Button”
  • “Dissolving the State in the Economy”
  • Counter-Institutions
  • Counter-Institutions and Counter-Economics
  • The Two Economies and the Shifting Correlation of Forces
  • Privatizing State Property
• Decentralized Production Technology
  • Introduction
  • Multiple-Purpose Production Technology
  • The Transition to Decentralized Manufacturing
  • Desktop Manufacturing Technology
  • Polytechnic
  • Eotechnic, Paleotechnic, and Neotechnic
  • Decentralized Agriculture
  • A Soft Development Path
• Social Organization of Production: Cooperatives and Peer Production
  • Introduction
  • Self-Employment: Increased Productive Efficiency
  • Cooperatives: Increased Productive Efficiency
  • Innovation Under Worker Self-Management
  • Social Benefits of Worker Empowerment
  • Peer Production
  • The Social Economy and the Crisis of Capitalism
• The Social Organization of Distribution, Exchange and Services
  • Demand-Pull Distribution
  • Local Exchange Systems: Household and Informal Economies
  • Certification, Licensing and Trust
  • Social Services
  • Mutual Aid and the Voluntary Welfare State
  • Education
  • Healthcare