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On Socio-Economic Roles And Specialisation

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  • ROBERT P. GILLES
  • EMILIYA LAZAROVA
  • PIETER H. M. RUYS

Abstract

Xiaokai Yang's theory of economic specialization under increasing returns to scale is a formal development of the fundamental Smith-Young theorem on the extent of the market and the social division of labor. In this theory specialization and, thus, the social division of labor is firmly embedded within a system of perfectly competitive markets. This leaves unresolved whether and how such development processes are possible in economies based on more primitive, non-market organizations. In this paper we discuss a general relational model of economic interaction. Within this non-market environment we discuss the emergence of economic specialization and eventually of economic trade and a social division of labor. We base our approach on three levels in organizational development: the presence of a stable relational structure; the presence of relational trust and subjective specialization; and, finally, the emergence of objective specialization through the institution and the social recognition of economic roles.

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File URL: http://hdl.handle.net/10.1111/j.1759-3441.2006.tb00392.x
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Bibliographic Info

Article provided by The Economic Society of Australia in its journal Economic Papers.

Volume (Year): 25 (2006)
Issue (Month): 2 (06)
Pages: 157-170

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Handle: RePEc:bla:econpa:v:25:y:2006:i:2:p:157-170

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References

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  1. Robert P. Gilles & Emiliya A. Lazarova & Pieter H. M. Ruys, 2007. "Stability, Specialization And Social Recognition," Division of Labor & Transaction Costs (DLTC), World Scientific Publishing Co. Pte. Ltd., vol. 2(02), pages 83-109.
  2. Young, Allyn A., 1928. "Increasing Returns and Economic Progress," History of Economic Thought Articles, McMaster University Archive for the History of Economic Thought, vol. 38, pages 527-542.
  3. Jackson, Matthew O. & Wolinsky, Asher, 1996. "A Strategic Model of Social and Economic Networks," Journal of Economic Theory, Elsevier, vol. 71(1), pages 44-74, October.
  4. Robert P. Gilles & Dimitrios Diamantaras, 2005. "New Classical Economics: Towards A New Paradigm For Economics?," Division of Labor & Transaction Costs (DLTC), World Scientific Publishing Co. Pte. Ltd., vol. 1(01), pages 35-56.
  5. Papai, Szilvia, 2004. "Unique stability in simple coalition formation games," Games and Economic Behavior, Elsevier, vol. 48(2), pages 337-354, August.
  6. Sun, Guang-Zhen & Yang, Xiaokai & Zhou, Lin, 2004. "General equilibria in large economies with endogenous structure of division of labor," Journal of Economic Behavior & Organization, Elsevier, vol. 55(2), pages 237-256, October.
  7. George J. Stigler, 1951. "The Division of Labor is Limited by the Extent of the Market," Journal of Political Economy, University of Chicago Press, vol. 59, pages 185.
  8. Cheng, Wenli & Yang, Xiaokai, 2004. "Inframarginal analysis of division of labor: A survey," Journal of Economic Behavior & Organization, Elsevier, vol. 55(2), pages 137-174, October.
  9. Yang, Xiaokai & Borland, Jeff, 1991. "A Microeconomic Mechanism for Economic Growth," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 460-82, June.
  10. Acemoglu, Daron & Johnson, Simon & Robinson, James A., 2005. "Institutions as a Fundamental Cause of Long-Run Growth," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 6, pages 385-472 Elsevier.
  11. Greif, Avner, 1994. "Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies," Journal of Political Economy, University of Chicago Press, vol. 102(5), pages 912-50, October.
  12. Robert Gilles & Dimitrios Diamantaras & Pieter Ruys, 2003. "Optimal design of trade institutions," Review of Economic Design, Springer, vol. 8(3), pages 269-292, October.
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