Contingency and increasing returns: a review essay of the Corporation and the Twentieth Century

This review essay of Richard Langlois’s The Corporation and the Twentieth Century (2023) has a threefold purpose. Firstly, I distill one angle of the conceptual framework Langlois employs in his meticulous business history: optimal organizational form is always historically contingent. It depends on costs and benefits of centralization, transaction costs (static and dynamic), and the degree of organizational and technological modularity. Secondly, from this framework I derive interpretive questions to serve as a guide to reading The Corporation and the Twentieth Century (or perhaps business histories in general). Thirdly, I highlight a theme that is present in the book, but never quite made explicit: the potential for increasing returns from platform innovations. Drawing from Langlois, I posit that platform innovations were a major contributor to the miraculous economic growth that took place in the twentieth century. While I touch on what I believe are the central themes of the book, The Corporation and the Twentieth Century has much more to offer both the theorist and historian, economist and businessman.