The American Corporation: Ideology and Reality

In recent years, managerial elites have urgently sought to justify what it is they do. As Wilbert Moore remarked in his Conduct of the Corporation (1962), executives have become worried about the merit of their positions, the salaries they receive but perhaps do not deserve, and the fact that finally they are accountable to no one but themselves. They know that they dispose of vast financial resources and that the economic health of workers, stockholders, and suppliers—as well as entire communities—depends on their decisions. Management, says Moore, is in a “moral crisis.”

The older ideology, as reflected in the writings of such economists as John Bates Clark or Frank H. Knight, now seems inadequate. Clark...