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, using rules and task guidelines, and ex post coordination, using communication and broad job assignments. It shows that: (i …This paper endogenizes coordination problems in organizations by allowing for both ex ante coordination of activities … coordination. In particular, specialization is often non-monotonic in the importance of coordination. (ii) Organizations exhibit …
Persistent link: https://www.econbiz.de/10005497860
, which must be adapted to a privately observed shock and coordinated with other tasks. Coordination requires that agents pay … leadership naturally arise as a response to organizational trade-offs between coordination and adaptation. At the optimum, all …. Surprisingly, improvements in communication technology may result in smaller but more adaptive organizations. …
Persistent link: https://www.econbiz.de/10011084079
Transactions take place in the firm rather than in the market because the firm offers agents who make specific investments power. Past literature emphasizes the allocation of ownership as the primary mechanism by which the firm does this. Within the contractibility assumptions of this...
Persistent link: https://www.econbiz.de/10005498046
In the 'Knightian' theory of entrepreneurship, entrepreneurs provide insurance to workers by paying fixed wages and bear all the risk of production. This paper endogenizes entrepreneurial risk by allowing for optimal insurance contracts as well as the occupational self-selection. Moral hazard...
Persistent link: https://www.econbiz.de/10005504306
Organizational economics has advanced along two parallel tracks, one concerned with motivating agents with diverging objectives, the other--less developed--with coordinating agents under cognitive limits. This survey focuses on the second strand and attempts to bring the two strands together....
Persistent link: https://www.econbiz.de/10009002388
We present a model in which the owner of the firm enjoys a private benefit from developing a personal relationship with the executives. This may lead the owner to retain a senior executive in office even though a more productive replacement is available. The model shows that the private returns...
Persistent link: https://www.econbiz.de/10008677237
We present a perfectly-competitive model of firm boundary decisions and study their interplay with product demand, technology, and welfare. Integration is pri- vately costly but is effective at coordinating production decisions; non-integration is less costly, but coordinates relatively poorly....
Persistent link: https://www.econbiz.de/10011083920
What is the relationship between product prices and vertical integration? While the literature has focused on how integration affects prices, this paper shows that prices can affect integration. Many theories in organizational economics and industrial organization posit that integration, while...
Persistent link: https://www.econbiz.de/10011084043
Two recent failures of the United States intelligence system have led to the creation of high-level investigative commissions. The failure to prevent the terrorist attacks of 9/11 prompted the creation of the 9/11 Commission, and the mistaken belief that Saddam Hussein had retained weapons of...
Persistent link: https://www.econbiz.de/10005656431
The paper studies the regulatory design in a industry where the regulated downstream provider of services to final consumers purchases the necessary inputs from an upstream supplier. The model is closely inspired by the UK regulatory mechanism for the railway network. Its philosophy is one of...
Persistent link: https://www.econbiz.de/10005792445