In this survey we give a short overview of the way in which the theory of the firm has been formulated within the ``mainstream" of economics, both past and present. As to a break point between the periods, 1970 is a convenient, if not entirely accurate, dividing line. The major difference between the theories of the past and the present, as they are conceived of here, is that the focus, in terms of the questions asked in the theory, of the post-1970 literature is markedly different from that of the earlier (neoclassical) mainstream theory. The questions the theory seeks to answer have changed from being about how the firm acts in the market, how it prices its outputs or how it combines its inputs, to questions about the firm's existence, boundaries and internal organisation. That is, there has been a movement away from the theory of the firm being seen as developing a component of price theory, namely issues to do with firm behaviour, to the theory being concerned with the firm as a subject in its own right.As to the quality of the paper I should warn you that it has been rejected by 7 journals so far, without a single referee's report being deemed necessary, i.e. the journal editors think its crap. This include a rejection from NZEP in less than a week; which has to be some sort of record!!! Thus read at your own risk.
Past and Present of the Theory of the Firm