The global financial crisis of 2008 illustrates the recent notion of a "Predatory economy" (Galbraith, 2006). This begins to answer the question of why near catastrophic corporate malfeasance exists with serious damaging consequences to the global financial system and the real economy. Indeed,...

The role of the entrepreneur is the most fundamental issue addressed by the modern theory of the firm.Coordination, an improvement in the allocation of resources, in a volatile economy depends on the continuing synthesis of new information.Processing this information requires a division of labor...

Provides a model that explains forms of business organizations in terms of ownership structure, on-the-job consumption preferences, and monitoring costs. The thesis of Berle and Means that the separation of ownership and control, or specialized ownership, which characterizes the modern...

Uses the tools of Coase's (1937) theory of the firm, and an analysis of property rights, incentives and monitoring, to assess the nature of the franchise contract. Franchising is of interest to economists because it represents a situation in which there is not a sharp distinction between...

This paper attempts to formalize the transaction cost theory of the firm. Building on the formal approach of Grossman and Hart (1986), a model is developed to capture the essential elements of the transaction cost theory, particularly those that are distinct from the formal property rights...

A computer-generated 3D quantitative fold is presented called Knowledge Valley and this virtual fold is used to model an Innovation-Based View of the evolution and development of SMEs by means of the growth of their knowledge assets. By using concrete values of employee number and annual...

We analyze the role of implicit contracts' (that is, informal agreements supported byquot; reputation rather than law) both within firms, for example in employment relationships between them, for example as hand-in-glove supplier relationships. We find that the optimalquot; organizational form...

Previous developments in the opportunism-independent theory of the firm are either restricted to special cases or are derived from the capabilities or resource-based perspective. However, a more general opportunism-independent approach can be developed, based on the work of Demsetz and Coase,...