Market Process Economics and the Theory of the Firm

The present paper is about research heuristics and methods within the field of economic organization. Its basic message is that the theory of economic organization can benefit from what is here referred to as “market process theory”, particularly in its Austrian manifestation. Fundamentally, this is because the modern economics of organization (principal-agent, incomplete contracts, transaction cost economics) confronts a number of both basic and crucial issues related to firm organization that it is ill-equipped to handle, but which market process economics is helpful for gaining some understanding of It is necessary to briefly explicate, first, what is meant by “market process theories” and, second, what these issues are.