American institutionalists were not theoretical but anti-theoretical.... Without a theory they had nothing to pass on except a mass of descriptive ma… - Ronald Coase

In my youth it was said that what was too silly to be said may be sung. In modern economics it may be put into mathematics.

What is studied is a system which lives in the minds of economists but not on earth. I have called the result “blackboard economics.” The firm and the market appear by name but they lack any substance. The firm in mainstream economic theory has often been described as a “black box.” And so it is.

In my view, what is wanted in industrial organization is a direct approach to the problem. This would concentrate on what activities firms undertake, and would endeavor to discover the characteristics of the groupings of activities within firms. Which activities tend to be associated and which do not? The answer may well differ for different kinds of firm.