Capital in the history of economic thought: charting the ontological underworld

Abstract

Abstract We undertake a comprehensive descriptive and comparative ontology of capital in the history of economic thought post-1870. Beginning with the pioneering contributions of Menger, Böhm-Bawerk, Clark and Knight, we reassess the familiar dualistic ontology of capital that contrasts ‘materialist’ and ‘fundist’ approaches. Advancing beyond this dualism, we find that the ontology of capital is an evolving mosaic presenting many nuances and overlapping with other ontologies concerning notions of time and atomism. There is no substitute for examining the diverse theories, causal explanations and conceptual systems in which capital is embedded. In episodic capital controversies, economists have employed distinctive metaphors of capital revealing hidden presuppositions that imply specific functional and dispositional properties of capital. Ontological comparison can uncover implicit ideas about capital, as evidenced in the metaphors used by Böhm-Bawerk, Hayek and Robinson. The benefits of a descriptive and comparative approach are further illustrated in our critical appraisal of the modern monetary ontology of capital associated with Piketty, business finance and growth accounting. Differentiated by their specific ontologies, each explanation of capital in market economies should be regarded as at best a very partial account, though our assessment shows that some explanations are relatively more fragmentary and impoverished than others.