It would be interesting to have a reference to some source that makes the claim of a paradox.
It is an interesting question but I don’t think economists are puzzles by the existance of corporation but rather by understanding where the margin is between when coordination becomes centralized and when it can be price mediated (i.e., market transaction). There is certainly a large literature on the theory of the firm. Coases “The Nature of the Firm” seems quite relevant. I suppose one could go back to Adam Smith and his insight about the division of labor and the extent of the market (which is also something of a tautology I think but still seems to capture something meaninful).
I’m not sure your explanation quite works but am perhaps not fully understanding your point. If people are hiring other people to do stuff for them that can be: hire an employee, hire some contractor to perform specific tasks for the business or hire some outside entity to produce something (which then seems a lot like a market transaction).
It would be interesting to have a reference to some source that makes the claim of a paradox.
It is an interesting question but I don’t think economists are puzzles by the existance of corporation but rather by understanding where the margin is between when coordination becomes centralized and when it can be price mediated (i.e., market transaction). There is certainly a large literature on the theory of the firm. Coases “The Nature of the Firm” seems quite relevant. I suppose one could go back to Adam Smith and his insight about the division of labor and the extent of the market (which is also something of a tautology I think but still seems to capture something meaninful).
I’m not sure your explanation quite works but am perhaps not fully understanding your point. If people are hiring other people to do stuff for them that can be: hire an employee, hire some contractor to perform specific tasks for the business or hire some outside entity to produce something (which then seems a lot like a market transaction).