Task assignment and organizational form
AbstractThis paper shows that a firm prefers a process-based task assignment compared to a function based one if the tasks are from functional areas which are neither too complementary nor too substitutable. We consider several projects with contributions from several functional areas. The organization can be structured along processes like product lines (M-form) or along functional areas like marketing or production (U-form). The U-form enables cost savings due to specialization or scale economies. We show that the more effective incentives under the M-form might outweigh these savings if the functions are neither too complementary nor too substitutable.
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Bibliographic InfoArticle provided by Springer in its journal Journal of Economics.
Volume (Year): 96 (2009)
Issue (Month): 2 (March)
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Web page: http://www.springerlink.com/link.asp?id=108909
Task assignment; Organizational form; Incomplete contracts; D02; L23;
Other versions of this item:
- D02 - Microeconomics - - General - - - Institutions: Design, Formation, and Operations
- L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
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