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date: 24 June 2021

Markets and Corporationsfree

Markets and Corporationsfree

  • Keir James Cecil MartinKeir James Cecil MartinSosialantropologisk institutt (SAI)


Corporations are among the most important of the institutions that shape lives across the globe. They often have a “taken for granted” character, both in everyday discourse and in economic or management theory, where they are often described as an inevitable outcome of the natural working of markets. Anthropological analysis suggests that neither the markets that are seen as their foundation nor corporations as social entities can be understood in this manner. Instead, their existence has to be seen as contingent on particular social relations and as being the outcome of long processes of historic conflict. The extent to which, at the start of the 21st century, corporations satisfactorily fulfill their supposed purpose of managing debt obligations in order to stimulate economic growth is particularly open to question. This was traditionally the justification for the establishment of corporations as separate legal actors in economic markets. Some 150 years on, other sociocultural relations and perspectives shape their boundaries and activities in a manner that means that their purpose and character can no longer be assumed on the basis of such axiomatic premises. Instead, their actions can be explained only on the basis of historic and ethnographic analysis of the contests over the limits of relational obligation that shape their boundaries.


  • Sociocultural Anthropology


Economic markets and corporations are among the most powerful and all-pervasive institutions in the world. There is probably not a single person alive whose life is not entangled in some way with their operations on a second-by-second basis in one way or another. From the food we eat and the water we drink all the way through to the quality of the air that we breathe, markets and the corporate entities that act in them and shape them are fundamental to the processes that sustain every human life across the planet. Alongside this all-pervasive character often goes a kind of naturalization. We may discuss booms and busts in particular markets or we may debate the social desirability of the operations and actions of particular corporations. However, the processes by which markets or corporations come into being and the possibilities of these being differently organized rarely enter public or political debate. This implicit naturalization is made explicit in much academic economic discussion of these topics. Anthropology is a discipline that has often placed the dismantling of such naturalizing narratives at the heart of its intellectual agenda. As such, it is not surprising that it has had a long history of critical engagement with narratives that promote the inevitability and universality of market-based forms of economic organization.

The Economic Assumption of the Natural and Inevitable Nature of Markets

Markets are in many regards the single most important organizing concept for economics as an academic discipline. They are often described as outgrowths of the most fundamental aspects of human nature, and they tend to function as the basic grounding assumption of how humans interact economically upon which other forms, such as corporations, are built. The most significant figure in the development of modern economics, Adam Smith, famously described

a certain propensity in human nature . . . the propensity to truck, barter, and exchange one thing for another. . . . It is common to all men, and to be found in no other race of animals, which seem to know neither this nor any other species of contracts.

(Smith [1776] 2007, 15)

Although Smith does not use the term “market” in this particular passage, it is a central organizing metaphor for his work, and what he describes here are the basic assumptions that underpin the use of the term “market” in subsequent economic theory. Market exchange is a fundamental expression of human nature. It is one of the universal human activities and indeed could be seen as one of our defining characteristics, being unique to us as a species and found in no other kind of animal. This vision of human nature as being based upon a desire to maximize goods through exchange with others became the basis for a naturalized social order based upon these market principles. For Smith, the mutual pursuit of self-interest led spontaneously and naturally to the emergence of the market, provided other social forces did not artificially interfere with its development. The market functioned to distribute goods and services where they were most needed in the most optimal fashion via freely emerging mechanisms such as prices altering in response to the fluctuating forces of supply and demand. Such forces led to the market operating as what Smith referred to as an “invisible hand,” organizing the economic distribution that underpinned the entire social order, through a mechanism that transcended the wisdom of conscious or centralized social planning but that appeared as the amalgamation of millions of daily transactions that were purely concerned with the immediate self-interest of the individuals engaged in them. Smith’s market is therefore an abstract force arising from human activity but in ways beyond their everyday awareness or control. One cannot see it or alter its principles. It is everywhere as the backdrop that emerges from our spontaneous activity and provides the framework within which that activity occurs. As we shall see, this naturalized backdrop then becomes the basis for an equally naturalized “emergence” of the organizational forms, such as corporations that dominate modern economic life, in many influential economic analyses.

Smith’s vision has proved remarkably enduring. His vision of markets remains central to neoclassical or neoliberal visions of the role of the economy. The neoliberal revolution of the 1980s in many regards was predominantly characterized by the aggressive reassertion of this element of Smith’s thought.1 For example, Milton and Rose Friedman, probably the most influential economic advocates of the return to pure market principles in this period, argue in a chapter of their bestseller Free to Choose, entitled “The Power of the Market,” that,

Adam Smith’s flash of genius was his recognition that the prices that emerged from voluntary transactions between buyers and sellers—for short, in a free market—could coordinate the activity of millions of people, each seeking his own interest, in such a way as to make everyone better off. It was a startling idea then, and it remains one today, that economic order can emerge as the unintended consequence of the actions of many people, each seeking his own interest.

(Friedman and Friedman 1980, 13)

This restatement of the principles of market fundamentalism was not limited to academics such as the Friedmans or the Austrian economist Friedrich Hayek. The leading political lights of the era also made explicit their devotion to this conceptual apparatus. United States President Ronald Reagan asserted near the start of his first term in office that,

We who live in free market societies believe that growth, prosperity and ultimately human fulfilment, are created from the bottom up, not the government down. . . . Government is not the solution to our problem. Government is the problem.

(Reagan 1981)

This aggressive assertion of the market as the ultimate guarantor not only of economic growth but of “human fulfilment” most generally was necessary as the neoliberals fought a battle against the postwar era mixed economies that relied to a large extent on government intervention. Thirty years later, it had become the shared ground that all politicians had to perform allegiance to in order to be taken seriously as part of the mainstream of political discourse, regardless of whether they were considered to be on the left or the right of the political spectrum. This hegemony was strengthened by the deepening of market relations in Eastern Europe and other parts of the world following the collapse of the Soviet Union in 1991 (Kjaerulff 2015, 6). It is only in the mid-2010s that it finally appears that the three-decade long hegemony of neoliberals is beginning to be challenged; sometimes from surprising quarters. If, forty years after the election of Thatcher and Reagan, we are now perhaps entering an era in which the kind of market fundamentalism proposed by the likes of Friedman and Reagan are finally open for challenge, then the task of de-naturalizing the idea of the market would appear to be a pressing issue. It is a task that anthropology has a long legacy of working toward.

Early Anthropological Critiques of the Universality of Market Exchange

In many regards, modern anthropology is born with the critique of market fundamentalism. More than any other book, Malinowski’s Argonauts of the Western Pacific can be seen as the foundational text of 20th-century British social anthropology, establishing the long-term participant observation designed to “. . .grasp the native’s point of view,” that has been fundamental to that tradition ever since. And although the word “market” appears only once in Malinowski’s text, the central argument of the book is in many regards a critical engagement with market fundamentalism. His analysis of the kula exchange cycle of the Trobriand Islands is designed to empirically disprove the assumption of “savage trade,” namely, the idea that people such as the Trobriand Islanders were merely conducting “trade” according to the same principles as Westerners imagined their own markets to operate, merely at a more “savage” or less technologically developed level. Malionwski was keen to stress that the principles and interests that drove complex networks of exchange did not necessarily have to be those of the kind of individual economic self-interest that underpinned notions of the market or savage trade. Malinowski argues that,

the a priori current notion of primitive trade would be that of an exchange of indispensable or useful articles, done without much ceremony or regulation, under stress of dearth or need, in spasmodic, irregular intervals—and this done either by direct barter, everyone looking out sharply not to be done out of his due . . . we have to realise clearly that the Kula contradicts in almost every point the above definition of “savage trade.”

(Malinowski 1922, 84–85)

Malinowski’s depiction of the kind of savage trade that he implies is assumed by most observers to look very much like the depiction of the universal traits in human nature that underpinned Smith’s vision of the market and its “invisible hand.” Like Smith’s depiction, the conception of savage trade that Malinowski seeks to critique is one that is driven by utilitarian desires for the objects concerned (“under stress of dearth and need”), and in which people are looking to maximize their incomings and minimize their outgoings of such utilities in accordance with the principles of “self-interest” laid out in Smith’s account (“everyone looking out sharply not to be done out of his due”). Instead, the kula, “contradicts in almost every point” this definition, being an exchange cycle in which intense effort is devoted to the circulation of objects of no utilitarian value outside of the exchange in which men gain renown for having the objects pass through their hands rather than possessing them, and for giving away rather than acquiring wealth.

Malinowski’s ethnography served as a specific empirical critique of the universality of market values as the organizing principles of economic life. It was to be taken up alongside other work on non-Western exchange cycles, such as the potlatch of the Pacific Northwest as the basis for a more general critique of market fundamentalism. Among the most notable of these general critiques was Marcel Mauss ([1925] 1990), whose analysis of the logic of gift exchange was explicitly framed as such a challenge. Taking Malinowski’s analysis of the kula as a starting point, Mauss developed a general theory of a form of exchange that looked to be the complete opposite of the commodity exchange that acted as the basic natural activity underpinning the idea of the market. As described in Smith and his followers, market exchange was ideally impersonal and did not necessarily create ongoing ties of obligation between its participants who were more interested in the object that they acquired than a relationship with the person with whom they were exchanging. Gift exchangers, such as participants in the kula, had a precisely opposite motivation, using the exchange of objects that often had no other utility in order to build and maintain relationships with other significant persons. The idea of the gift thereby acted as a powerful general critique of the universality and inevitability of market principles as the fundamental basis for organizing economic life, and as Mauss observed, a development of Malinowski’s attack on “current doctrines concerning ‘primitive’ economy” (Mauss [1925] 1990, 92).

Ethnographic critiques of the universality of market principles were also taken up outside of the discipline, most notably in the work of the mid-20th-century political economist Karl Polanyi. Polanyi’s (1944) masterpiece, The Great Transformation, argued that the conceptual separation of the economy from other aspects of social life was itself a central part of the rise of a social order based upon market principles in the early 19th century. Polanyi drew heavily upon ethnographic sources such as Malinowski to drive home the point that the seeming naturalness of market principles advocated by mainstream economics could be empirically questioned. Polanyi continues Malinowski’s critique of the concept of “primitive trade” to question what he calls the myth of the “bartering savage” that he argues underpins Smith and other classical economists’ work. Instead of assuming such a natural motivation for socioeconomic activities, Polanyi reverses the direction of analysis, arguing that economic motives “spring from the context of social life.” Therefore, the analyst has to pay careful attention to the wider cultural systems of values that may make market values of self-interested competitive exchange validated in one context and denigrated in another. She certainly cannot assume them as the basis for actions across contexts, as many pro-market theorists, such as Polanyi’s Viennese contemporary Hayek tended to do, but must instead look at how social institutions are shaped in order to encourage or discourage them. This means that many societies will not prioritize market values in the way that modern capitalist societies emerging in Europe and North America in the mid-19th century tended to do.

Market as Abstraction or Market as Institution

Polanyi’s critique of market fundamentalism was taken back into anthropology by a number of anthropologists inspired by his work. Throughout the 1950s and 1960s, economic anthropology was dominated by a debate between his followers, the so-called “substantivists” who sought to ethnographically demonstrate the ways in which non-Western economies were not organized according to market principles, and their opponents, the “formalists,” who attempted to demonstrate that even the most seemingly exotic and different forms of economic life could be adequately explained using the “formal” categories of mainstream classical economics. This debate pitted two fixed positions against each other, and by the 1970s, had, according to Clifford Geertz, “staled for all but the most persevering” (Geertz 1978, 28). Geertz’s solution to this problem was a return to ethnographic observation; in particular, the study of institutions that have come to stand for what is understood as “the market” in non-Western contexts. Geertz’s analysis based upon ethnographic analysis of bazaars in Indonesia (Geertz 1963) and Morocco (Geertz 1978) shifted the terms of debate in anthropology in a number of ways. Perhaps most importantly, it moved the debate from the abstract market developed in economic theory to actual markets to explore the extent to which they actually embodied the market principles that economics had abstracted from them. Geertz notes that previous studies of “peasant markets” had tended toward one of the two prevailing approaches, namely, a formalist approach that saw them as “penny capitalism” or a substantivist one that saw them as “so embedded” in their “sociocultural context as to escape the reach of modern economic analysis altogether.” This tendency toward one pole or the other can often be observed in other studies of such markets of this period, often emerging in unusual manners. T. S. Epstein and Richard Salisbury, for example, conducted a joint survey of the famous Rabaul Town market in the early 1960s. Both authors were broadly speaking affiliated to the formalist position. Salisbury (1970, 4) explicitly positions himself as a formalist in his monograph Vunamami, and Epstein’s (1968) position is summed up in the title of her monograph, Capitalism: Primitive and Modern, in which she argues that the Tolai people of the region were predisposed toward economic development by virtue of their existing cultural value systems. In particular, she takes a customary shell-wealth item, tabu, that circulated at important ritual and life cycle events and, in contrast to Malinowski’s claim that such items embodied a non-market-based economic logic, argues that they operated as a form of money and that their “accumulation” both powered the “primitive” Tolai economy and predisposed them toward an enthusiastic embrace of economic development in the colonial period. This formalist embrace of the universality of market principles in contexts such as customary exchange is interestingly reversed in her analysis of the actual Rabaul market, however. Here, her empirical study of the market leads her to conclude that “. . .social considerations impeded the development of professional market traders” (Epstein 1968, 164). The women who traded at the market were tied to each other by immensely complex webs of reciprocal interdependence (of the kind mediated by the circulation of tabu at customary events) and consequently did not undercut each other or act in an economically competitive manner. Epstein’s account drew attention to the ways in which specific forms of kinship relations, in this case matrilineal descent groups, were important parts of how Tolai women engaged in and made markets. This was an approach with resonances to other ethnographic work being produced at the time, such as Hill’s (1963) account of how the difference between patrilineal and matrilineal descent groups in Ghana tended to lead to different kinds of locally owned collectives or companies engaging in the emerging cocoa industry, an analysis that foreshadows some of the discussion of the entanglement of kinship and corporations in more recent ethnographies of Europe and North America, discussed below, “Creating Firm Boundaries.” The paradox of Epstein’s account was that market principles were to be found everywhere, except at the actual market itself, which were seen to be embedded in other forms of social relationships that operated according to non-market principles (see also Martin 2018, 242–244).

Beyond the Ethnographic Critique of Markets

Geertz’s attempt to look at the operation of actual markets in order to break free of what he considered to be the dead end of the formalist–substantivist debate prefigured trends in anthropological analyses of markets from the 1980s onward. Previous anthropological critique is increasingly questioned as being based upon a problematic focus upon the small-scale non-Western societies that illustrate the possibility of non-market exchange, in the manner pioneered by Malinowski. For example, the anthropologists Chris Hann and Keith Hart, in a monograph examining the continued relevance of Polanyi’s The Great Transformation in the 21st century, argue that, although we can be proud of anthropology’s historical commitment to seeing the world from what Malinowski described as the native’s point of view, economic anthropology’s perspective was largely based upon

. . .extended sojourns in remote areas, and their ability to address the world’s economic trajectory was much impaired as a result.

(Hann and Hart 2011, 1–2)

Anthropology’s critique of market fundamentalism was largely based upon “their particular findings about primitive societies” (Hann and Hart 2011, 2). This type of critique is open to the twin charges that it is based upon a caricature of both Western and non-Western societies in which the former unproblematically express the principles of the market and the latter some kind of alternative economic rationality, such as that of the “gift.” Although the critique of the universality of market principles was often couched ethnographically in these terms, it is important to remember that the pioneers of such approaches were explicit about the coexistence of different economic values in the societies that they studied. Malinowski, for example, was at pains to stress that alongside kula exchange, a different kind of economic transaction, known as gimwali, was also conducted (Malinowski 1922, 96, 189–191, 362–364). Gimwali embodied all the principles of self-interested market exchange, including haggling for the maximum return, described by Smith as fundamental to economic exchange and denounced as inappropriate for the kula. Conversely, although Mauss subtitled his essay on “The Gift” as, “The Form and Reason for Exchange in Archaic Societies,” he was keen to stress that, even in 20th-century Western Europe, the logic of the market and the logic of the gift coexisted, and that the task of good governance was to find an appropriate balance between them (Mauss [1925] 1990, 85–107). Likewise, Polanyi was clear that “. . .the institution of the market was fairly common since the late Stone Age,” but that until the Great Transformation, “. . .its role was no more than incidental” (Polanyi 1944, 45). The ethnographic critique of the universality of market economics had always been aware of the coexistence of market and non-market economic logics. Nonetheless, as Hann and Hart observe, the critique of market fundamentalism was largely based upon the discovery of non-market principles in the non-Western world, implicitly leaving the division of the world into two spheres, one dominated by the market and the other by non-market principles as a starting point of critique. Similarly, Karen Ho (2009, 38) has argued that ideas such as the “Great Transformation” tend to blind us to the extent that markets are still embedded in networks of kinship obligation and non-utilitarian values, even on Wall Street, where she conducted fieldwork.

Market as Performative Metaphor

Geertz’s work had drawn attention to the ways in which actual markets themselves embodied an interplay between the kind of abstract market principles of economic theory and embedded social relational obligations. Part of the importance of this analysis was to redraw attention to the ways in which

. . .the word market itself [is] as much an analytical idea as the name of an institution, and the study of it . . . as much a theoretical as a descriptive enterprise.

(Geertz 1978, 29)

Geertz drew attention to the complexities of the actual institution of the market and how on occasion they diverged from the market as an analytical idea, such as that developed in classical economics. Other anthropologists turned their focus in the other direction, on the performative power of this abstract analytical idea in shaping society in its own image. James Carrier, for example, states that his concern is “ . . .the idea of the Free Market” (Carrier 1997, vii). For Carrier,

. . .“the Market” is not what people do and think and how they interact when they buy and sell, give and take. Instead, it is a conception people have about an idealized form of buying and selling.

(Carrier 1997, vii)

This ideal is massively important as it shapes the parameters of political debate over issues such as the provision of services to the vulnerable or the protection of state-owned industries. Carrier’s critique is in many regards similar to other anthropological critiques of the market from the 1980s onward. The older ethnographic approach of finding non-Western alternatives to the market often implicitly or explicitly assumed that markets actually operated according to market principles, in the West at least. Hence, for example, in Epstein’s depiction of how the Rabaul market did not operate like an abstract market, she draws a contrast between the more conventionally market-oriented activity that she had observed among traders at the street market in Camden Town, North London (Epstein 1968, 142). The critique advanced by Carrier is organized along different lines. His argument is that the market as an ideal type does not truly fit the complex reality of how people “buy and sell” or “give and take” anywhere in the world, including “the West.” This does not make the idea of the “Free Market” unimportant, however, as it remains an idea that people can make use of to shape the appropriate limits of obligation and the morality of exchange in specific contexts. Ho, in her research on financial markets on Wall Street, makes clear that while those markets are embedded in all kinds of seemingly non-market sociality, the rhetorical separation of the market from those networks is a key part of its construction as an abstract entity whose existence justifies and even demands particular kinds of financial decisions (e.g., Ho 2009, 186). Here, despite her previously mentioned skepticism of Polanyi, Ho’s work echoes many of his themes, not least his argument that, “the idea of a self-adjusting market” was central to the operation of modern economies and that this “idea” of a disembedded self-regulating social field was, in fact, a “Utopia” that could never be realized in practice (Polanyi 1944, 3, emphasis added).

As Narotzky observes, such a conception was already present in the work of the classical theorists such as Polanyi, for whom the “self-regulating market,” disembedded from other forms of social networks was a “utopia,” albeit one that helped to shape those very social networks that it sought to describe (Narotzky 1997, 97). Hence, the opposition between a “market culture” and a “non-market culture” in modern societies should not be seen as a situation in which the latter is a vestigial remnant of a previous social order, but instead as part of the process of the spread of market morality in modern capitalist society. The two sustain each other and rely upon each other in historically changing formulations; the production of new generations of the market commodity “labor,” in the non-market sphere of the domestic family that relies upon the financial support of its adult members’ sale of their now-marketized capacity to labor, acts as one important example of this tendency (Narotzky 1997, 96–97).

The Mutual Dependence of Market and Non-Market Rationalities

Twenty-first-century anthropology tends to pay attention to this interplay between market and non-market principles across cultural contexts and divides. Whereas the earlier critique may have denaturalized market exchange in the non-West but implicitly accepted its primacy or inevitability in the West, much of this work seeks to explore the ways in which the market relations have to be carefully cultivated and sustained through acts of social engineering even in their alleged Western heartlands. Anna Tsing’s description of the trade in matsutake mushrooms provides one example. Tsing sets out to describe the immense work of sorting, assessment, and grading that she argues disembeds the mushrooms from the social relations of their collection and production so that they can then be traded on the market. This work is vital to the ability to trade the mushrooms as commodities, but it is “covered up by ideologies of market transparency” (Tsing 2013, 23). This is an analysis that, as Tsing (2013, 22) acknowledges, draws to some degree on Marx’s analysis of the ways that the trading of commodities on the market tends to obscure the labor and social relations that went into their production and distribution (Marx [1867] 1973, 163–177; see also Graeber 2001, 65). To the extent that markets even operate as markets at all, they do not emerge naturally but have to be carefully constructed through the social engineering of rhetorically disembedding them from the other kinds of social networks within which they must inherently be embedded. Tsing’s analysis of contemporary global mushroom trading is of a very different scale and order to Geertz’s analysis of the Moroccan bazaar produced nearly four decades earlier. In its emphasis on the ways in which market-based principles of exchange are not only opposed to, but are reliant on, other kinds of social obligation, it does, however, hark back to Geertz’s observation of how the market that he studied was based upon such opposed principles that “. . .do not just co-occur, they imply one another” (Geertz 1978, 30). Market transactions at the bazaar were only made possible by enduring relations of moral obligation that were themselves sustained through market exchanges at the bazaar. The two kinds of exchange may have needed to have been conceptually opposed in order to operate as they did, but this in no way undermines their mutual necessity. Bazaars may have embodied many of the key principles of market exchange as imagined by neoclassical economists, but there was still more to them than “another demonstration of the truth that, under whatever skies, men prefer to buy cheap and sell dear” (Geertz 1978, 29). Similarly, for Skinner ([1964] 2002), working in rural China, markets were both embedded in and constitutive of other kinds of administrative, religious, and social networks and institutions. Even if these markets did not operate purely by the abstract market principles of neoclassical theory, buying and selling for profit often was a central aspect of the market’s operation. These markets had “important social as well as economic dimensions” (Skinner [1964] 2002, 243). They tied together disparate villages, making possible religious and kinship ties that transcended those villages to the point that Skinner ([1964] 2002, 243) argued that,

Anthropological work on Chinese society, by focusing attention almost exclusively on the village, has with few exceptions distorted the reality of rural social structure. Insofar as the Chinese peasant can be said to live in a self-contained world, that world is not the village but the standard marketing community.

The community of villages tied together through periodic contact through a local market marks a community that transcends those villages. That is important enough for Skinner to describe it, not the villages it encompasses, as the most important “culture-bearing unit” (Skinner [1964] 2002, 243). This community is not the “imagined” community of the nation-state, to later be described by Anderson (1983). Instead, a man who regularly traded at such markets (as most men would have to) would have some knowledge of almost every other man in the other villages. These men formed a network of some significance, being potentially a basis for religious cooperation or the making of family alliances through marriage. The market as a physical place in which buying and selling for profit occurred was a central location for the reconstitution of such other networks and was itself also reliant upon them. A similar necessary combination of conceptually opposed economic processes is observed by ethnographers in other contexts, such as Jamie Cross’s description of the ways in which the selling of labor as a commodity in an Indian diamond factory is inherently intermingled with kinship and friendship obligations through which workers learn the skills necessary to survive on the factory floor, even if these different types of relational obligation are often rhetorically opposed to each other as part of their operation (Cross 2015).

This kind of approach is perhaps taken to its rhetorical extreme in the spate of ethnographies that have appeared in the 21st century studying the archetypal market phenomena of the West, namely, the financial markets and institutions that seem to dominate the world economy. If there is one arena of social life in which market values or principles should be expected to dominate in the manner that fits the abstract market of neoclassical economics, then surely we should expect to find it here. Ethnographies of financial markets instead argue that even in these representatives of capitalism in its purest form, market principles only emerge out of other kinds of social relations from which they are only rhetorically separated with great difficulty and effort (e.g., Zaloom 2006; Ho 2009). Ho argues that these social networks are central to the reproduction of class, gender, and racial privilege across the generations, a process that is partially obscured by inequalities of wealth being portrayed as outcomes of a neutral market. This process in which established social networks can thus be leveraged for economic gain bears some comparison with Bourdieu’s earlier analysis of the role of “social capital” in economic life in which “more or less institutionalized relationships of mutual acquaintance and recognition” (Bourdieu and Wacquant 1992, 119) can be leveraged and transformed into their economic equivalent.

Firms and Corporations

One aspect of economic markets that much previous anthropological analysis often left unexplored was the nature of the economic agents who operated within them. Most empirical studies tended to be of face-to-face markets in non-Western contexts in which individual traders built relationships with or traded with each other. In the abstract global marketplace, however, the vast majority of trade is conducted by non-human actors; firms or corporations of particular types who are considered legally separate from the humans who own, manage, or work for them. Although the ideal of the market has been subjected to sustained interrogation by economic anthropologists, the emergence and purpose of these agents have not been so well studied to date. Ethnographic analysis of the kind that denaturalized the market remains a potentially fruitful path for an anthropological analysis of these economic actors that goes beyond the assumptions of mainstream economic theory.

The naturalization of the market has arguably operated as the basis for most subsequent economic analysis, as can be seen in theories of the emergence of entities such as firms or corporations. Probably the most significant economic contribution to this debate was Ronald Coase’s 1937 article, “The Nature of the Firm.” Coase’s article is one of the most influential pieces of writing in economics or any other social science in the 20th century, having been cited over 40,000 times and winning its author a Nobel Prize in economics in 1991. Starting from neoclassical assumptions about the naturalness and efficiency of markets, Coase sets himself the problem: if markets are the most efficient way of distributing resources, then why do organizations that internally suppress market mechanisms and replace them with hierarchical command structures, such as firms or corporations, even exist? As Coase observes,

Outside the firm, price movements direct production, which is co-ordinated through a series of exchange transactions on the market. Within a firm, these market transactions are eliminated and in place of the complicated market structure with exchange transactions is substituted the entrepreneur-co-ordinator who directs production. Yet, having regard to the fact that if production is regulated by price movements, production could be carried on without any organization at all, well might we ask, why is there any organization?

(Coase 1937, 388)

Coase’s response is that there is always a cost to using the “price mechanism” itself. One has to pay to be part of a market; participation in the market can itself be a commodity to be traded according to market principles, along the lines of having to pay rent to the owner of a market to set up a stall there. In a modern economy, these “transaction costs” include such features as drawing up and enforcing contracts. Sometimes the market cost of market transactions makes them inefficient and so a degree of centralization and suppression of market pricing mechanisms is efficient. It is vital to stress, however, that this partial suppression of market principles within the firm itself emerges from the operation of the market and in response to its demands for greater efficiency. Firms emerge from the market, as Coase approvingly quotes D. H. Robertson, in the form of

. . .islands of conscious power in this ocean of unconscious co-operation like lumps of butter coagulating in a pail of milk.

(Coase 1937, 388)

This picture of the emergence of firms has been by far the most influential account in economic theory and it shares many features with other influential accounts since (e.g., Jensen and Meckling 1976). Most fundamentally, the firm or corporation is seen to emerge naturally as a response to particular features of the natural tendency toward market organization that emerges in an “unconscious” manner, or as Smith would have had it, constructing a beneficial social order “without knowing it” (Smith [1759] 2005, 165).

Creating Firm Boundaries

It is this picture of the firm or corporation as the natural emanation from a naturally occurring market that anthropology is well positioned to critically interrogate. Although not as much work has been conducted in this direction, what has been done builds upon previous work that critiqued the assumption of the universality and inevitable centrality of market morality. Sylvia Yanagisako’s work on the emergence of family firms in Italy, for example, draws our attention to the ways in which the official narratives of these firms’ establishment do not present them as naturally emerging spontaneous phenomena but as the outcome of the particular intense agency of specific male founding fathers. More than this, however, her work also stresses the ways in which these official narratives seem to deliberately obscure the other familial relations and economic investments, particularly those of female kin, upon which the firm’s establishment, which is retrospectively reconstructed as the outcome of heroic male individual agency, ultimately rest. Like markets, firms can be seen as social entities that are ultimately formed out of a web of relational obligations that, to a large extent, embody non-market principles from which they have to be painstakingly rhetorically disembedded (Yanagisako 2002, 55–56, 69–70).

This creation of economic actors out of the limitation of extended obligations reaches its apotheosis with the emergence of the modern corporation in the United States and the United Kingdom in the late 19th century. The nature of the corporation has been a topic of major debate in economics and legal theory, yet it has not been so widely studied in anthropology. This is perhaps a surprising oversight, given that an analysis of the ways in which social groups or organizations can be created out of the contextual limitation of relational obligation has been central to much anthropological work in non-Western contexts, such as in the work of Marilyn Strathern (1988). As Riles observes, an ethnographic focus on the nature of large-scale economic transactions can, in Marilyn Strathern’s terms, “‘. . .yield a remainder’; the question of the nature of the persons engaged in such transactions” (Riles 2011, 32). The corporation is legally recognized as a separate “person” under law in the United States and the United Kingdom from its investors and shareholders. Indeed, as a person, it is formed from the legal limitation of their debt obligations. By limiting shareholders’ liability for its debts to its creditors, the corporation is brought into being as a person or entity separate to those shareholders. The corporation is a non-human being brought into existence through the conscious reconfiguration and reorganization of relational obligations in legal ritual. It does not emerge naturally in a process akin to the coagulation of butter in a pail of milk or even as the outcome of the will of a single heroic founding father. It is the outcome of particular legal ritual technology of a kind highly suitable for anthropological analysis.

Corporations and the Limitation of Debt

Despite this, little anthropological work has been done on the nature of the modern corporate form itself. Most of the works cited in Urban and Koh’s (2013) Annual Review of Anthropology article, “Ethnographic Research on Modern Business Corporations,” deal with issues such as the effect of particular corporations on their labor force or cultural differences between corporations in different parts of the world rather than their fundamental nature as persons and how this is related to their construction through a process of reorganizing existing relational obligations. Some work that has begun this process, however, includes Riles (2011), Martin (2012), and Leaver and Martin (2016). Riles does partially build her critical exploration of the question of “what kinds of persons are the agents of financial market transactions” around a cultural comparison with a non-Western example at its heart, in this case the Japanese houjin or “legal person,” a category that would include not only the commercial entities commonly recognized in US law, but also other entities such as schools or even kinship groups. The question of culture remains a central one in other analyses of the relationship between markets and corporations. Ho, for example, stresses that the market is not a naturally occurring phenomenon but a culturally produced idea for organizing social relationships. Markets therefore have to be made or “done,” and specific corporate organizations with particular cultures are the “. . .constructors of market norms and expectations” (Ho 2009, 182). The cult of shareholder value that became dominant on Wall Street in the mid-1990s reshaped both the financial institutions and the corporations that promoted it, and the very nature of the markets that they helped to construct. Different kinds of organizational forms may then tend to try to shape markets in different manners. Although many corporations are owned by a wide variety of shareholders, family-owned companies, of the kind studied by Yanagisako, still control large amounts of global trade. Marcus (1985) describes how the “dynastic” ownership of the Hunt Oil Company was a central part of the cultural dynamic of the organization that led to an attempt to take control of the global market in silver in the late 1970s. Although their attempt ultimately failed on its own terms, it impacted massively upon how the market operated and brought the idea of speculatively “cornering the market” that had largely fallen into abeyance during the postwar Keynesian period back into market calculations. Their efforts were only stopped by “. . .government and internal market regulators [who] understood what the Hunts were doing, [and] merely changed the rules of trade. . .” (Marcus 1985, 254). This arguably re-illustrates Polanyi’s point that specific kinds of markets are made by specific kinds of governments and states in specific historic contexts, or the point made by Malinowski and De la Fuente ([1957] 1982, 154–173), in their study of 1940s Mexican marketplaces, that although transactors in these markets often embodied the “buy cheap–sell dear” principles of classical economics, their actions at market were also the outcome of social conventions regulating market exchange. In addition, the different ways in which different kinds of companies attempt to shape markets may suggest that far from corporations emerging naturally, like islands of butter from the naturally occurring milk pail of the market, here the market itself has to be carefully culturally constructed by those very actors that Coase would posit as their outcome.

Riles’s analysis is built most fundamentally upon the relationship between corporations and the organization of debt relations, the latter being, as Riles observes, “. . .a long-standing theme in the anthropology of economy, personhood and kinship” (Riles 2011, 33). This focus is further developed in the work of Martin (2012), who explores the creation of modern corporations through debt limitation. Using a comparison between early legal disputes over the nature of the separation between shareholders and corporations in late Victorian England and disputes over the nature of the distinction between business relations and customary kinship relations in early 21st-century Papua New Guinea, he argues that despite the differences in the conceptualization of debt in these different contexts, they share the fundamental similarity that in both cases, it is the limitation of “. . .debt, that shapes the nature of those social entities connected by it” (Martin 2012, 482). This perspective is in many regards similar to Riles’s attempt to apply earlier anthropological analyses on the different meanings of debt and their relationship to the emergence of particular social entities to the analysis of modern corporations as persons. Riles observes that

There are obviously important differences between corporate debt and relations and the kind of debts that emerge from gift exchange relations. One crucial difference is that corporate debt is framed (ideologically at least) as debt for a limited time: once the debt is paid the parties, formally speaking, will become strangers again and go their separate way. Whether or not this in fact occurs in any practical sense does not displace the rhetorical force of the formal concept of an endpoint in the parties’ relationship. . . . But there are also parallels.

(Riles 2011, 33)

Riles’s point here is that the distinction between corporate debt and gift debt is as much rhetorical as absolute and that the ideal of the disinterested corporate transactor should be seen in the same way as Ho or Zaloom describe Wall Street traders as being embedded in kinship-like relations that they rhetorically disembed themselves from, or the way in which Carrier describes the ideal of the “Free Market” as helping to organize a world in some ways very different from that ideal, or even the way in which Geertz describes the long-term embedded relations of particular traders in the Moroccan bazaar as being precisely the ground that enables them to, on occasion, trade with each other in a manner akin to the self-interested maximizing individual described by Adam Smith. The fact that this distinction is rhetorical should not be taken to mean that it is unimportant, however. The ideal remains a powerful tool for the organization and limitation of social obligation and the subsequent creation and character of the entities and legal persons that conduct financial transactions. What Riles’s work points toward is the importance of ethnographic research that explores in detail the ways in which different conceptualizations of debt obligation are used to construct different kinds of corporate persons in different contexts. Such work has, for the most part, not yet been attempted, but as Riles and Martin both observe, the potential of previous anthropological analyses of themes such as debt and the limitation of reciprocal obligation in this sphere is waiting to be realized.

Eliciting Corporations

One attempt to begin this kind of analysis is provided in Leaver and Martin (2016). Their paper, “Creating and Dissolving Social Groups from New Guinea to New York: On the Overheating of Bounded Corporate Entities in Contemporary Global Capitalism,” attempts to explore how the changing nature of debt relations may be changing the nature of corporations in the 21st century. They argue that the emergence of the modern corporation in the United States and the United Kingdom as one of the fundamental social building blocks of 20th-century global capitalism may lead one to assume that a move from the unstable elicitation of shifting corporate groups described as characteristic of many non-Western societies, such as Melanesia, as described by Roy Wagner (1974), toward more stable and fixed corporate entities, such as IBM or the Ford Motor Company, was one of the fundamental changes in social organization that accompanies the transition to capitalist modernity. Instead, they argue that

. . .what an examination of the modern corporation suggests is that a tension between fluidity and fixity has always been at the core of its creation and maintenance, and that this tension has been exacerbated by recent developments. . . .

(Leaver and Martin 2016, 597)

In particular, they draw attention to the ways in which new technologies for the mixing and repackaging of debt (such as mortgage-based securities) lead to the proliferation of new and inherently unstable corporate forms, such as Structured Investment Vehicles (SIVs), whose separation from the financial entity that establishes them is a matter of shifting and unstable legal perspective (Leaver and Martin 2016, 596–597). SIVs’ major role in the implosion of the sub-prime housing market in the United States and the subsequent global financial crisis of 2007–2008 has been noted by many observers, including anthropologists (e.g., Tett 2009). What is less noted are the ways in which the strategic shifting of legal perspectives between those that stress the extent to which SIVs are separate from or still encompassed by the financial corporations that establish them, becomes an increasingly central part of the ways in which streams of revenue are diverted to flow in the direction of well-networked players in the market (Leaver and Martin 2016, 596). This kind of instability was always a potential in the constitution of corporate forms as separate entities, but it is now arguably intensified by regulatory and technological changes, potentially leading to corporations, in some significant manifestations at least, becoming increasingly unstable and porous entities, with significant implications for global economic security in the 21st century.


Much mainstream economic analysis has presumed or asserted the natural emergence of the universality of market mechanisms and market values as the main organizing principles of economic life or, indeed, of society as a whole. Likewise, the kinds of non-human entities or legal persons, such as firms or corporations, are often described in such analysis as being themselves natural consequences of these universal natural market principles. Anthropology has a long and successful history of critical engagement with these assumptions. For much of the 20th century, these critiques were largely based on specific ethnographic descriptions of non-Western cultural contexts in which the operation of different economic principles could be seen to be equally or more important than market principles. From the 1980s onward, anthropological critique increasingly took a different direction in which it subjected the alleged natural dominance of market principles, and even capitalism’s Western heartlands, to ethnographic examination, illustrating the never-ending work that had to go into partially disembedding market exchange from other forms of social interaction and interconnection. This critique is increasingly applied not only to the operations of financial markets but also to the entities, such as corporations, that act within them. As the nature and stability of markets and corporations seem increasingly up for grabs in the uncertain economic environment of the early 21st century, the anthropological task of ethnographically exploring how markets and the economic agents that act within them come into being is perhaps more important than ever before.


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  • 1. Other elements of Smith’s work, such as his advocacy of a “labor theory of value,” were less amenable to the neoliberals and tended to be overlooked.