Date of this Version
Research in Organizational Behavior
What is the purpose of business? While most agree that business minimally involves the creation of value, a blurred double image of value haunts our discussion of purpose. The image of what counts as value for a single firm is laid atop an image of what counts as value for business in general. These two images cannot match. Indeed, the resulting conceptual blurriness is a classic example of a composition fallacy. We should never mistake the properties of a part for the properties of the whole. A theory of the firm is ill equipped to handle the many expectations we hold for business practice. As such, we seek to establish the beginnings of a theory of business, one that is both empirical and normative. Offering four central propositions about the purpose, accountability, control and success of business, we close with a consideration of several important theoretical issues and practical opportunities that await us in the years ahead.
© 2015 The Authors. Published by Elsevier Ltd. This is an open access article under the CC BY license (http://creativecommons.org/licenses/by/4.0/).
Donaldson, T., & Walsh, J. P. (2015). Toward a Theory of Business. Research in Organizational Behavior, 35 181-207. http://dx.doi.org/10.1016/j.riob.2015.10.002
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Date Posted: 20 June 2018
This document has been peer reviewed.