The Ontology of Economic Things

In August 2011, Mitt Romney, then running in the Republican presidential primary, shocked the public when he proclaimed that corporations were people. His words came in the wake of an earlier Supreme Court decision, Citizens United, which gave corporations constitutional rights of free speech, rights formerly applied only to actual human beings. Like Frankenstein's monster, the corporation, a purely artificial entity, was being endowed with the spirit of life.

Treated as a legal matter, corporate personhood has a long and contentious history. Perhaps though, Romney was offering not a legal but a philosophical argument. Specifically, he may have been addressing the corporation's ontology. Ontology is that branch of metaphysics concerned with being, with what things are. It invites us to consider the composition of social facts and social entities. What, then, do corporations consist of? If they are not people, what are they?

Historians generally, and historians of business and the economy in particular, rarely ask such questions. In part, this is because our preference is to examine causes. Ontology is not about what causes things to happen, however, but what constitutes things such that they have causal powers. A house may be constituted out of bricks, but bricks did not cause the house to be built. Whereas causation is concerned with how one thing changes or affects another, constitution is a relation among parts, about how things are so arranged or structured that they acquire their properties. Cause usually involves temporality—one thing happens and then something else changes. Constitution is usually nontemporal. The fragility of glass is constituted by its molecular structure. Once the structure is set, fragility is set as well. Nothing must occur over time for glass to be fragile.¹

One reason to take a closer look at ontology is that we tend to examine and explain matters in ways that comport with our understanding of their constitution. The philosopher Brian Epstein makes an analogy with biology. When biologists realized that living organisms were comprised of cells, they believed that cytology, the study of cells, would be sufficient for the science of life. As it turns out, this was a poor assumption. Although much of the living body is cellular, much is not. Water and minerals, bones, teeth, hair, and certain nerve fibers are all necessary parts of our bodies but are not made of cells. In other words, model the body as only cells and you have a very poor model, one lacking in much of the substance of what we are. Does the same hold for society? How do we understand the composition of social "things": groups, markets, organizations, production systems, states, laws.² Are these comprised of only people? If not, is studying just people adequate?³

Epstein and a number of other philosophers question some of our deeply held, though often poorly examined, convictions about social things. They argue against social science's attachment to methodological individualism. Methodological individualism treats the social as purely comprised of individuals. The popular form of this claim would be Margaret Thatcher's assertion that there is no such thing as society, only people. Implicitly, then, the only thing that we should attend to in our research programs is people, for what else is there? More precisely, we can think of methodological individualism as having two components: ontological individualism and explanatory individualism. The first holds that that all social entities are nothing but people; the second holds that any social explanation must run through the actions of individuals. We can accept both of these claims; we can reject one but keep the other; or we can reject both.

Methodical Individualism in Theory and History

Over the past century and a half, social theory has been wrestling with the following question: Does society have structures that direct the actions of people, or is society simply the sum total of individual interactions? The first position emerged sometime in the nineteenth century, when the availability of social data began to reveal definite, almost mathematical, patterns of social life—in births and deaths, crime, urban growth, and perhaps most famously, suicide. It was the...