Holism and Collectivism in the Work of J.R. Commons

Article excerpt

Recent years have witnessed a considerable resurgence of interest in institutional economics, much of which has been generated by contributions going under the heading of "new institutional economics."(1) Although it is difficult to impose any precise programmatic unity upon these contributions [Coates 1986; Maki 1987], it is certainly possible to discern various important commonalities. Most significantly, as other commentators have already pointed out [e.g., Hodgson 1989; Rutherford 1989, 1994], new institutionalist writers share an adherence to some form of individualism. That being the case, however, it warrants emphasis that the precise form of the individualism at work in new institutionalist contributions is rarely spelled out. Rather, the usual strategy is to distinguish and criticize positions understood to be alternatives to individualism such as holism and collectivism. Of particular interest here is the fact that when examples of such supposedly untenable alternatives to individualism are cited, the work of J. R. Commons is frequently referred to. Commons's work is referred to because it is held to exemplify certain errors that are to be transcended. Thus, although new institutionalists often incorporate or express sympathy toward some of Commons's specific ideas (an obvious example being Williamson's [1975; 1985] use of the "transaction" as the basic unit of analysis), their main objective is to define their own general methods and concerns as being in direct opposition to those of Commons.

The purpose of this paper is basically twofold. First, I want to argue that the new institutionalist contributions misrepresent Commons's actual writings. That is, they tend to set up a "straw-person" interpretation of Commons.(2) Second, I wish to offer some explanation of the identified misrepresentations. More specifically, in the first part of this paper I focus upon some of the more prominent criticisms of Commons's work, particularly the claims that it constitutes an untenable form of holism and/or collectivism. I then identify those aspects of Commons's writings that appear most to encourage the critical interpretations noted, especially Commons's use of concepts such as the "collective will," and draw out the disparities between interpretations of Commons's work and his actual writings. Last, some attempt is made to account for these disparities by focusing on underlying perspectives or, more precisely, on ontological presuppositions that have been largely ignored in the relevant literature. Here, I use the interwar work of Hayek to support and illustrate the argument that the sorts of mischaracterizations made of Commons's position indicate a problem that is internal to individualist positions in general.

Common's Critics

One especially revealing criticism of Commons's work is provided by Olson [1965]. Although writing before the emergence of the new institutionalism, Olson has been very influential upon new institutionalist writers and, I suggest, shares their intentions in referring to Commons's work. Olson attempts to defend the ideas he puts forward concerning collective action. In particular, Olson objects to the view that:

groups of individuals with common interests are expected to act on behalf of their common interests much as single individuals are often expected to act on behalf of their personal interests [Olson 1965, 1].

It is in discussing adherents to this view that Olson refers to the work of Commons. Specifically, Olson outlines and critiques various theories of pressure groups (including that of Commons), referring to the commonalities in these as "analytical pluralism." What is distinctive (but inadequate) about analytical pluralism, Olson claims, is that it cannot (or does not attempt to) show why the individual member of a large group will voluntarily support the group goal or act in the collective interest "when his support will be decisive in achieving the goal and when he would be as likely to get the benefits of the goal whether he contributes to its attainment or not" [Olson 1965, 1]. …