The dynamics of organizational structures and performances under diverging distributions of knowledge and different power structures

In this work we analyze the characteristics and dynamics of organi- zations wherein members diverge in terms of capabilities and visions they hold, and interests which they pursue. How does society put together such distributed and possibly coflicting knowledge? The question is "Hayekian" in its emphasis on the distributed features of the latter. However, our analytical point of departure is quite "anti- Hayekian" in that it focuses on how organizations aggregate and put to use such knowledge by means of di®erent combinations among power of allocation of decisions and exercise of authority. Together, organizational power shapes the very preferences of organizational members. More specifically, we study the efficiency of different balances between the three foregoing mechanisms. In all that, organization for sure "aggregate" and make compatible different pieces of distributed knowledge, but the causation arrow goes also the other way round: organizations shape the characteristics and distribution of knowledge itself, and of the micro "visions" and judgements.