Two fallacies about corporations [Deux sophismes ? propos des personnes morales]

Abstract

This paper seeks to identify and criticize two fallacies or mistakes that might dull our sense of dismay at the scenario of a fully corporatized world, weakening our commitment to guard against it. These two fallacies apply to commercial bodies but more generally to our sense of what is and what do corporate bodies. The first fallacy is that corporations are networks of individual - to - individual, relatively enduring arrangements, and they exist because of serving the contracting parties better than more regular, episodic contracts. The mistake or fallacy here is the assumption, quite common in economics circles, that there is no literal sense in which corporations constitute agents like you and me. The second fallacy is common within legal rather than economic traditions of thought and involves an error of the opposite kind. It holds that corporations are indeed agents like you and me, not just impersonal contractual arrangements. But it maintains that they are personal agents and that they have a just claim to the rights that our constitutions give to natural persons like you and me. The authors argues against the first fallacy that corporate bodies are agents - agents indeed that have capacities characteristic of natural persons - and that they do raise a challenge for us as citizens who have to make our lives in their company. Against the second he argues that, on pain of betraying the ideal of individual equality, we should only give corporate bodies the rights that it is in the interest of the community of natural persons to bestow; they do not have any independent claims in their own name.