This paper analyzes empirically the boundaries of the firm based on Williamson's perspective on what determines firm size. It uses firm performance (risk-adjusted profitability and growth) as dependent variable; and firm organization, diseconomies of scale (atmospheric consequences, bureaucratic...

This article tests Oliver Williamson's proposition that transaction cost economics can explain the limits of firm size. Williamson suggests that diseconomies of scale are manifested through four interrelated factors: atmospheric consequences due to specialization, bureaucratic insularity,...