The agent-based approach views an organization as a collection of agents, interacting with one another in their pursuit of assigned tasks. The performance of an organization in this framework is determined by the formal and informal structures of interactions among agents, which define the lines of communication, allocation of information processing tasks, distribution of decision-making authorities, and the provision of incentives. This chapter provides a synthesis of various agent-based models of organizations and surveys some of the new insights that are being delivered. The ultimate goal is to introduce the agent-based approach to economists in a methodological manner and provide a broader and less idiosyncratic perspective to those who are already engaging in this line of work. The chapter is organized around the set of research questions that are common to this literature: (1) What are the determinants of organizational behavior and performance? (2) How does organizational structure influence performance? (3) How do the skills and traits of agents matter and how do they interact with structure? (4) How do the characteristics of the environment--including its stability, complexity, and competitiveness--influence the appropriate allocation of authority and information? (5) How is the behavior and performance influenced when an organization is coevolving with other organizations from which it can learn? (6) Can an organization evolve its way to a better structure?
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ReDIF This chapter was published in: Leigh Tesfatsion & Kenneth L. Judd (ed.) Handbook of Computational Economics, , chapter 26, pages 1273-1337, 2006.
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Related research
This chapter was published in the following book, which is listed on IDEAS: Leigh Tesfatsion & Kenneth L. Judd (ed.), 2006.
"Handbook of Computational Economics,"
Handbook of Computational Economics,
Elsevier,
edition 1, volume 2, number 2, September.
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Find related papers by JEL classification: C63 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Computational Techniques
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Holmstrom, Bengt R. & Tirole, Jean, 1989.
"The theory of the firm,"
Handbook of Industrial Organization,
in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 1, chapter 2, pages 61-133
Elsevier.
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