Legal Foundations of Capitalism

One of his most important American studies of labor economics published in the twentieth century, this book outlines an evolutionary and behavioral theory of value based on data drawn from court decisions. Analyzing the meaning of reasonable value as defined by the courts, he finds that the answer is based on a notion of reasonable conduct. Expanding this point to encompass the habits and customs of social life, he shows that court decisions are based on customs that are powerful forces shaping the economic system. In an early review Wesley Mitchell declared that Commons [1862-1945] carried this "analysis further along his chosen line than any of his predecessors. Into our knowledge of capitalism he has incorporated a great body of new materials which no one else has used adequately.": American Economic Review, XIV (1924) 253.