Why Valve? Or, what do we need corporations for and how does Valve’s management structure fit into today’s corporate world? | Valve:
Market-societies, or capitalism, emerged when, some time in the 18th century, the expulsion of peasants from their ancestral lands (the so-called Enclosures in Britain), and their replacement with sheep (whose wool had become an internationally traded commodity), gave rise to the gradual commodification of land (with each acre acquiring a value reflecting the value of wool that could ‘grow’ on it) and, then, of labour (as the, now, landless peasants were eager to sell their labour time for a loaf of bread, money, anything of exchange value). Once land and labour became commodities that were traded in open markets, markets began to spread their influence in every direction. Thus, societies-with-markets begat market-societies.
Interestingly, however, there is one last bastion of economic activity that proved remarkably resistant to the triumph of the market: firms, companies and, later, corporations. Think about it: market-societies, or capitalism, are synonymous with firms, companies, corporations. And yet, quite paradoxically, firms can be thought of as market-free zones. Within their realm, firms (like societies) allocate scarce resources (between different productive activities and processes). Nevertheless they do so by means of some non-price, more often than not hierarchical, mechanism!