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Elements of a Cognitive Theory of the Firm

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  • Nooteboom, B.

    (Tilburg University, Center for Economic Research)

Abstract

This paper presents elements of a cognitive theory of the firm, from the perspective of embodied cognition.It entails the notion of 'cognitive distance' between people that have developed their cognition in different environments. This yields the notion of the firm as a 'focusing device', to reduce cognitive distance for the sake of efficient collaboration and for the resolution of conflict.This focus yields organisational myopia, which needs to be compensated by outside relations, between firms, at some cognitive distance.Next, on the basis of principles derived from cognitive science, this paper tries to resolve the problem of combining structural stability and change, which in economics is known as the problem of combining exploitation and exploration.This provides the basis for a theory of learning and innovation in organisations and economies.The theory is elaborated on the basis of the notion of 'scripts', also derived from cognitive science.

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Bibliographic Info

Paper provided by Tilburg University, Center for Economic Research in its series Discussion Paper with number 2005-46.

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Date of creation: 2005
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Handle: RePEc:dgr:kubcen:200546

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Web page: http://center.uvt.nl

Related research

Keywords: organizational learning; theory of the firm;

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References

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  1. Wuyts, Stefan & Colombo, Massimo G. & Dutta, Shantanu & Nooteboom, Bart, 2005. "Empirical tests of optimal cognitive distance," Journal of Economic Behavior & Organization, Elsevier, vol. 58(2), pages 277-302, October.
  2. Pertti H. Lounamaa & James G. March, 1987. "Adaptive Coordination of a Learning Team," Management Science, INFORMS, vol. 33(1), pages 107-123, January.
  3. Colombo, Massimo G. & Garrone, Paola, 1998. "Common carriers' entry into multimedia services," Information Economics and Policy, Elsevier, vol. 10(1), pages 77-105, March.
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Citations

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Cited by:
  1. Bart Nooteboom, 2007. "Methodological interactionism: Theory and application to the firm and to the building of trust," The Review of Austrian Economics, Springer, vol. 20(2), pages 137-153, September.
  2. Cayla, David, 2008. "Learning, Rationality and Identity Building - From Simon To Varela," Economics Papers from University Paris Dauphine 123456789/5005, Paris Dauphine University.
  3. repec:hal:wpaper:halshs-00340832 is not listed on IDEAS
  4. Bart Nooteboom, 2008. "In what sense do firms evolve?," Papers on Economics and Evolution 2008-12, Philipps University Marburg, Department of Geography.

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