The Historicism of John R. Commons’s Legal Foundations of Capitalism

Abstract

It is widely appreciated that American institutional economics (of the now “old” type) bears a family resemblance to the German, and even the English, historical schools. They share emphases on a broad conception of the economic system, an empirical rather than strictly deductive apriorist approach to knowledge, the importance of institutions, the conduct of case studies, and a deep sense of the historicity of the economic system and of economics as discipline. It is also widely appreciated that, although one can make strong exclusivist cases for rationalism and for empiricism, and for pure deduction and for pure induction, in practice these approaches to knowledge are not mutually exclusive; they are always used in some combination. Facts are always theory-laden and theory is always tied to some perception of facts/phenomena. All this applies to historicism.