"I began a description of the "corporate form" (the technical and legal definition of the structure of of a corporation) with "The economic rationale of the corporation ...", and you need to pay attention to the use of the word "rationale". This is why people use the corporate form, and what is expected of it. Responding that corporations in reality are inefficient is entirely beside the point. If that mattered, then why is the world crawling with corporations? In fact, you reinforce my point: If the corporation form were all that dysfunctional, why do all those allegedly smart people continue to use it? Focus on that reality."

A corporation or bureaucracy can survive beyond the lifespan of individuals. The main function is to provide stabilty and continuation. The way a bureaucracy is organized is provide specific tasks to individuals and that these individual can be replaced by others who can perform the same function. You could say that this social structure is an artifical life form- you could liken it to any multicellular lifeform. But obviously, no corporation is as well organized as say a mouse or an ant.

You could look at this way, the human creature has been specializing for at least thousands of years- some make bronze tools; some make grass baskets. Though I'm not saying they didn't multitask. And generally, we humans assign a large amount importance to those who can do anything well or the better than one else.

Now, specifically:
"In fact, you reinforce my point: If the corporation form were all that dysfunctional, why do all those allegedly smart people continue to use it?"

I would say instead that smart people continue to make it. In other words, we aren't done. But like a stone axe, it is useful.