Firms and industries in evolutionary economics: Lessons from Marshall, Young, Steindl and Penrose

Harry Bloch, John Finch

Research output: Contribution to journalArticlepeer-review

9 Citations (Scopus)


Evolutionary economists have tended to assess firms and industries separately, neglecting the role of their interaction in the process of economic growth and development. We trace the separation of firms and industries to the introduction of population thinking in the discipline of industrial economics, including some broadly evolutionary analyses. If researchers conflate a population of firms with an industry, they introduce 'thin' means of relating firms to one another and to industries. Despite his device of the 'representative firm', Marshall develops 'thick' means of relating firms to industries by means of their internal and external organizations. Penrose avoids the notion of industry by focussing on heterogeneous and potentially mobile firms. Young and Steindl develop mundane explanations of firms' relations within groups and locate the impetus for economic growth in a poorly understood environment. We conclude that evolutionary economists should revisit firms' boundaries, not in the sense of explaining the existence of firms but in a relating and communicating sense in which boundaries signify the selective means of firms' relationships.
Original languageEnglish
Pages (from-to)139-162
Number of pages24
JournalJournal of Evolutionary Economics
Issue number1
Early online date15 Apr 2009
Publication statusPublished - 15 Jan 2010


  • firms
  • industries
  • Marshallian economics
  • organization
  • economies
  • firms’ boundaries


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