Monopolies Life Cycle, Bureaucratization, and Schumpeterian Growth
AbstractThis Paper analyses the link between the internal organization of firms, their individual life cycle and the whole process of macroeconomic growth. We present a Schumpeterian growth model in which firms face dynamic agency costs. These agency costs are due to the formation of vertical collusions within the organization. To respond to the opportunity of internal collusion, firms go through a whole life cycle, becoming more bureaucratized and less efficient over time. This bureaucratization affects both the intertemporal distribution of profits in a given sector and the distribution of output across sectors. In a general equilibrium model, bureaucratization has two effects: a profitability effect on the return of innovation and a reallocation effect on the skilled labour market. First, we analyse the existence and properties of stationary equilibrium growth. Second, we endogenize the transaction costs of side-contracting and show how the growth rate depends on various organizational parameters of firms.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoPaper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 2700.
Date of creation: Feb 2001
Date of revision:
Contact details of provider:
Postal: Centre for Economic Policy Research, 77 Bastwick Street, London EC1V 3PZ.
Phone: 44 - 20 - 7183 8801
Fax: 44 - 20 - 7183 8820
Other versions of this item:
- Martimort, D. & Verdier, T., 1999. "Monopolies Life Cycle, Bureaucratization and Schumpeterian Growth," Papers 1999-09, Laval - Laboratoire Econometrie.
- Martimort, D. & Verdier, T., 1999. "Monopolies Life Cycle, Bureaucratization and Schumpeterian Growth," DELTA Working Papers 1999-09, DELTA (Ecole normale supérieure).
- D92 - Microeconomics - - Intertemporal Choice - - - Intertemporal Firm Choice, Investment, Capacity, and Financing
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
- O40 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Daron Acemoglu & Philippe Aghion & Fabrizio Zilibotti, 2002.
"Vertical Integration and Distance to Frontier,"
NBER Working Papers
9191, National Bureau of Economic Research, Inc.
- Acemoglu, Daron & Aghion, Philippe & Zilibotti, Fabrizio, 2002. "Vertical Integration and Distance to Frontier," CEPR Discussion Papers 3565, C.E.P.R. Discussion Papers.
- Acemoglu, Daron & Zilibotti, Fabrizio & Aghion, Philippe, 2003. "Vertical Integration and Distance to Frontier," Scholarly Articles 4481512, Harvard University Department of Economics.
- Knobel, A., 2009. "Vertical Integration and Economic Growth: An Empirical Study," Journal of the New Economic Association, New Economic Association, issue 3-4, pages 54-70.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.