Most economic theory is based on the assumption that economies grow in a linear fashion. Recessions, depressions and (financial) crises are explained by policy mistakes. However, economic development has historically been uneven, and this state of affairs continues today. This book argues that twentieth century economic theory has marginalized individualism and organizational variety, and puts forward the case for a pluralist approach. This book represents a unique synthesis of business theory and economic theory, which pinpoints the problems with many current mainstream theories and sets out new agendas for research. Here, Maria Brouwer argues that market competition is not about adapting to changes from outside, but is driven by human motivation and goal directed behavior. This gives managerial skills, which do not traditionally have a significant place in mainstream economic theory, a key role. It also highlights the need for organizations that have a motivational culture and appreciate human capital. This differs from the traditional view of the firm as a production function dictated by technology. Brower argues that organizations should be depicted as voluntary associations of people that pursue goals of their own, while firms compete on markets, where relative performance determines their fate. This argument builds on older theories of innovation and market competition that live on in business school curricula, and paints a picture of an economy directed by individuals and firms. This signals a bold departure from standard economic thinking.

Most economic theory is based on the assumption that economies grow in a linear fashion. Recessions, depressions and (financial) crises are explained by policy mistakes. However, economic development has historically been uneven, and this state of affairs continues today. This book argues that twentieth century economic theory has marginalized individualism and organizational variety, and puts forward the case for a pluralist approach. This book represents a unique synthesis of business theory and economic theory, which pinpoints the problems with many current mainstream theories and sets out new agendas for research. Here, Maria Brouwer argues that market competition is not about adapting to changes from outside, but is driven by human motivation and goal directed behavior. This gives managerial skills, which do not traditionally have a significant place in mainstream economic theory, a key role. It also highlights the need for organizations that have a motivational culture and appreciate human capital. This differs from the traditional view of the firm as a production function dictated by technology. Brower argues that organizations should be depicted as voluntary associations of people that pursue goals of their own, while firms compete on markets, where relative performance determines their fate. This argument builds on older theories of innovation and market competition that live on in business school curricula, and paints a picture of an economy directed by individuals and firms. This signals a bold departure from standard economic thinking.

"This provocative book applies law and finance theory to a wide range of issues bearing on corporate governance and business history. Brouwer's analysis should hold particular interest for students and scholars interested in comparative governance."

Joseph A. McCahery, Professor of Corporate Governance and Innovation, University of Amsterdam Center for Law and Economics

This book focuses on the relationships between rules of decision-making and economic development, concentrating on the similarities and differences between old and modern modes of governance in both business and politics. Brouwer uses concepts such as uncertainty and expectations to analyze political and corporate governance models from an economic theoretical perspective.

Brouwer analyzes the emergence of organizations and institutions conducive to commerce and growth and the relationship with political organization in both past and present in order to improve our understanding of economic development. The author shows how maritime trade spawned many organizational innovations in the past that still feature modern innovative enterprise. The author highlights how political governance stimulates or impedes innovation, taking issue with existing legislation on bankruptcy and corporate governance. The effects of political governance on innovation are modelled to analyze how competition for novelty enhances the value of human capital.

"This provocative book applies law and finance theory to a wide range of issues bearing on corporate governance and business history. Brouwer's analysis should hold particular interest for students and scholars interested in comparative governance." Joseph A. McCahery, Professor of Corporate Governance and Innovation, University of Amsterdam Center for Law and Economics This book focuses on the relationships between rules of decision-making and economic development, concentrating on the similarities and differences between old and modern modes of governance in both business and politics. Brouwer uses concepts such as uncertainty and expectations to analyze political and corporate governance models from an economic theoretical perspective. Brouwer analyzes the emergence of organizations and institutions conducive to commerce and growth and the relationship with political organization in both past and present in order to improve our understanding of economic development. The author shows how maritime trade spawned many organizational innovations in the past that still feature modern innovative enterprise. The author highlights how political governance stimulates or impedes innovation, taking issue with existing legislation on bankruptcy and corporate governance. The effects of political governance on innovation are modelled to analyze how competition for novelty enhances the value of human capital.

This book investigates the performance of economic development under different forms of government, ranging from autocratic states to liberal democracies. Starting with a critical review of the literature on social and economic development, including the works of Frank Knight, Max Weber, Joseph Schumpeter and Peter Drucker, it offers a historical analysis of the expansion of markets, cities and trade in medieval Europe, and the monopolization of trade by the emerging European nation states. The book also presents a case study on the rise and decline of the Dutch Republic, discusses topics such as the disadvantages of the central direction of economic organizations, and federal decentralization as a model for promoting growth and investment, and illustrates how successful companies like Semco and Google are building on centuries-old management principles.

This book investigates the performance of economic development under different forms of government, ranging from autocratic states to liberal democracies. Starting with a critical review of the literature on social and economic development, including the works of Frank Knight, Max Weber, Joseph Schumpeter and Peter Drucker, it offers a historical analysis of the expansion of markets, cities and trade in medieval Europe, and the monopolization of trade by the emerging European nation states. The book also presents a case study on the rise and decline of the Dutch Republic, discusses topics such as the disadvantages of the central direction of economic organizations, and federal decentralization as a model for promoting growth and investment, and illustrates how successful companies like Semco and Google are building on centuries-old management principles.