The Dynamics of Marshall's Industry and Trade

‘Standardization’ and Development of Organization

Abstract

The economics of Marshall has long been assessed mainly on The Principles of Economics; besides, the assessment centered on the partial-equilibrium aspect of it. Although Marshall himself recommended and pursued a biological economics, his attempt has been evaluated as merely a promise. This paper examines Industry and Trade, which has practically been ignored as far as its theoretical aspect is concerned. One can find ‘standardization’ plays the key role in the historical accounts of that book. ‘Standardization’ which means more common knowledge possessed by members of an organization, is caused by habitual behaviours of agents or institutional arrangements agreed upon and promotes the development of that organization, thereby increasing the productivity of it. ‘Standardization’ captures an interaction of men and environments in an economic sense and provides Marshallian economics with the dynamics necessary for organizational growth.