The Volokh Conspiracy

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Did Corporations Fund the Rise of Law and Economics in the 1940s and 1950s?


A post by Robert Van Horn at the blog of Stigler Center of University of Chicago's Business school asserts that "from 1946 throughout the 1950s, corporations made possible and crucially supported the rise of Chicago law and economics through funding and advice…" He implies that corporate involvement influenced the normative positions of Chicago School economics, in particular skepticism of antitrust laws. Michael Simkovic at Leiter has more.

The problem is that there is nothing in Van Horn's post documenting that corporations funded the relevant scholars at Chicago. The only funding discussed in the article is from the Volker Fund. As Wikipedia explains: "The William Volker Fund was a charitable foundation established in 1932 by Kansas City, Missouri, businessman and home-furnishings mogul William Volker. Volker founded the fund with the purposes of aiding the needy, reforming Kansas City's health care and educational systems, and combating the influence of machine politics in municipal governance. Following Volker's death in 1947, Volker's nephew, Harold W. Luhnow continued the fund's previous mission, but also used the fund to promote and disseminate ideas on free-market economics."

So out of curiosity I checked the longer academic article on which the blog post was based. There, I found that Van Horn refers to Volker as a "nonprofit corporation." Sure, but when we talk about "corporate funding," we aren't usually referring to philanthropies. Is funding from the Ford Foundation "corporate funding?"

Beyond that, we learn that Chicago Law School Dean Edward Levi "obtained funding for fellowships from corporations. Starting in the fall of 1952, Standard Oil of Indiana, Swift and Co., International Harvester, International Mineral and Chemical Co., Borg-Warner Co. and Sears Roebuck provided funds for three years. The funding would go toward the study of antitrust law, and the project became known as 'The Antitrust Project.'" Beyond that, another corporation funded a two-week antitrust seminar for lawyers.

In sum, "corporate funding" amounted to a handful of three-year fellowships for independent scholarly research, and a two-week seminar. To extrapolate from that corporate funding was "crucial" to the rise of law and economics (the start of which the author himself dates to several years earlier), much less that it affected the substantive views of those involved, is quite a stretch.

This perhaps is not of great interest in and of itself, but seems part of a pattern. There has been a sudden outpouring of scholarship from left-leaning scholars on the history of post-World War II free market and libertarian thought. Much of it lacks academic rigor and has something of a conspiratorial tone, as if no reasonable person could believe such ideas, and therefore they must be the product of corporate influence, a cover for racism and white supremacy, and so on.