A Naturalistic Approach to the Theory of the Firm: The Role of Cooperation and Cultural Evolution

This file is part of IDEAS, which uses RePEc data

A Naturalistic Approach to the Theory of the Firm: The Role of Cooperation and Cultural Evolution

Author Info

C. Cordes
P. J. Richerson
R. McElreath
P. Strimling

Additional information is available for the following registered author(s):

Christian Cordes

Abstract

One reason why firms exist, this paper argues, is because they are suitable organizations within which cooperative production systems based on human social predispositions can evolve. In addition, we show how an entrepreneur – given these predispositions – can shape human behavior within a firm. To illustrate these processes, we will present a model that depicts how the biased transmission of cultural contents via social learning processes within the firm influence employees’ behavior and the performance of the firm. These biases can be traced back to evolved social predispositions. Humans lived in tribal scale social systems based on significant amounts of intra- and even intergroup cooperation for tens if not a few hundred thousand years before the first complex societies arose. Firms rest upon the social psychology originally evolved for tribal life. We also relate our conclusions to empirical evidence on the performance and size of different kinds of organizations. Modern organizations have functions rather different from ancient tribes, leading to friction between our social predispositions and organization goals. Firms that manage to reduce this friction will tend to function better.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help file. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

Publisher Info
Paper provided by Max Planck Institute of Economics, Evolutionary Economics Group in its series Papers on Econonmics and Evolution with number 2006-06.

Download reference. The following formats are available: HTML, plain text, BibTeX, RIS (EndNote), ReDIF
Length: 23 pages
Date of creation: Jun 2006
Date of revision:
Handle: RePEc:esi:evopap:2006-06

Contact details of provider:
Postal: Kahlaische Strasse 10, D-07745 Jena
Phone: +49-3641-68 65
Fax: +49-3641-68 69 90
Web page: http://www.econ.mpg.de/
More information through EDIRC

Order Information:
Email:
Web: http://www.econ.mpg.de/english/research/EVO/discuss.php

For technical questions regarding this item, or to correct its listing, contact: ().

Other versions of this item:

Find related papers by JEL classification:
L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
D21 - Microeconomics - - Production and Organizations - - - Firm Behavior
M13 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - New Firms; Startups
M14 - Business Administration and Business Economics; Marketing; Accounting - - Business Administration - - - Corporate Culture; Social Responsibility
C61 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Optimization Techniques; Programming Models; Dynamic Analysis

This paper has been announced in the following NEP Reports:

NEP-ALL-2006-07-02 (All new papers)
NEP-BEC-2006-07-02 (Business Economics)
NEP-CBE-2006-07-02 (Cognitive & Behavioural Economics)
NEP-ENT-2006-07-02 (Entrepreneurship)
NEP-EVO-2006-07-02 (Evolutionary Economics)
NEP-HPE-2006-07-02 (History & Philosophy of Economics)
NEP-PKE-2006-07-02 (Post Keynesian Economics)
NEP-SOC-2006-07-02 (Social Norms & Social Capital)

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.:

Witt, Ulrich, 1998. "Imagination and leadership - The neglected dimension of an evolutionary theory of the firm," Journal of Economic Behavior & Organization, Elsevier, vol. 35(2), pages 161-177, April. [Downloadable!] (restricted)
Alchian, Armen A & Demsetz, Harold, 1972. "Production , Information Costs, and Economic Organization," American Economic Review, American Economic Association, vol. 62(5), pages 777-95, December. [Downloadable!] (restricted)
Other versions:
- Armen A. Alchian & Harold Demsetz, 1971. "Production, Information Costs and Economic Organizations," UCLA Economics Working Papers 10A, UCLA Department of Economics. [Downloadable!]
Demsetz, Harold & Villalonga, Belen, 2001. "Ownership structure and corporate performance," Journal of Corporate Finance, Elsevier, vol. 7(3), pages 209-233, September. [Downloadable!] (restricted)
Theodore C. Bergstrom, 2002. "Evolution of Social Behavior: Individual and Group Selection," Journal of Economic Perspectives, American Economic Association, vol. 16(2), pages 67-88, Spring. [Downloadable!] (restricted)
Rubin, Paul H., 1982. "Evolved ethics and efficient ethics," Journal of Economic Behavior & Organization, Elsevier, vol. 3(2-3), pages 161-174. [Downloadable!] (restricted)
Boyd, Robert & Richerson, Peter J., 1980. "Sociobiology, culture and economic theory," Journal of Economic Behavior & Organization, Elsevier, vol. 1(2), pages 97-121, June. [Downloadable!] (restricted)
Winter, Sidney G, 1971. "Satisficing, Selection, and the Innovating Remnant," The Quarterly Journal of Economics, MIT Press, vol. 85(2), pages 237-61, May. [Downloadable!] (restricted)
Ernst Fehr & Simon Gachter, 2000. "Cooperation and Punishment in Public Goods Experiments," American Economic Review, American Economic Association, vol. 90(4), pages 980-994, September. [Downloadable!] (restricted)
Other versions:
- Ernst Fehr & Simon Gaechter, . "Cooperation and Punishment in Public Goods Experiments," IEW - Working Papers iewwp010, Institute for Empirical Research in Economics - IEW. [Downloadable!]
- Ernst Fehr & Simon Gaechter, 1999. "Cooperation and Punishment in Public Goods Experiments," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
Armen A. Alchian, 1950. "Uncertainty, Evolution, and Economic Theory," Journal of Political Economy, University of Chicago Press, vol. 58, pages 211. [Downloadable!] (restricted)
Ernst Fehr & Klaus M. Schmidt, 1999. "A Theory Of Fairness, Competition, And Cooperation," The Quarterly Journal of Economics, MIT Press, vol. 114(3), pages 817-868, August. [Downloadable!] (restricted)
Other versions:
- Ernst Fehr & Klaus M. Schmidt, . "A Theory of Fairness, Competition and Cooperation," IEW - Working Papers iewwp004, Institute for Empirical Research in Economics - IEW. [Downloadable!]
- Fehr, Ernst & Schmidt, Klaus M., 1998. "A Theory of Fairness, Competition and Cooperation," CEPR Discussion Papers 1812, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
Langlois, Richard N, 1998. "Personal Capitalism as Charismatic Authority: The Organizational Economics of a Weberian Concept," Industrial and Corporate Change, Oxford University Press, vol. 7(1), pages 195-213, March.
Joseph E. Harrington & Jr., 1999. "Rigidity of Social Systems," Journal of Political Economy, University of Chicago Press, vol. 107(1), pages 40-64, February. [Downloadable!] (restricted)
Nicolai J. Foss, . "The Theory of the Firm: an Introduction to Themes and Contributions," IVS/CBS Working Papers 98-7, Department of Industrial Economics and Strategy, Copenhagen Business School. [Downloadable!]
repec:att:wimass:199612r is not listed on IDEAS
Gary E. Bolton & Axel Ockenfels, 2000. "ERC: A Theory of Equity, Reciprocity, and Competition," American Economic Review, American Economic Association, vol. 90(1), pages 166-193, March. [Downloadable!] (restricted)
Eshel, Ilan & Samuelson, Larry & Shaked, Avner, 1998. "Altruists, Egoists, and Hooligans in a Local Interaction Model," American Economic Review, American Economic Association, vol. 88(1), pages 157-79, March. [Downloadable!] (restricted)
Kenney, Martin & von Burg, Urs, 1999. "Technology, Entrepreneurship and Path Dependence: Industrial Clustering in Silicon Valley and Route 128," Industrial and Corporate Change, Oxford University Press, vol. 8(1), pages 67-103, March.
Simon, Herbert A, 1978. "Rationality as Process and as Product of Thought," American Economic Review, American Economic Association, vol. 68(2), pages 1-16, May.
Henrich, Joseph, 2004. "Cultural group selection, coevolutionary processes and large-scale cooperation," Journal of Economic Behavior & Organization, Elsevier, vol. 53(1), pages 3-35, January. [Downloadable!] (restricted)

Full references

Cited by:
(explanations, 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.)

C. Cordes, 2007. "Emergent Cultural Phenomena and their Cognitive Foundations," Papers on Econonmics and Evolution 2007-22, Max Planck Institute of Economics, Evolutionary Economics Group. [Downloadable!]

Statistics

Access and download statistics

Did you know? You too can volunteer for RePEc, for example by editing a NEP report.

This page was last updated on 2008-8-6.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.