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The Network-Firm as a Single Real Entity: Beyond the Aggregate of Distinct Legal Entities

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Author Info
Virgile Chassagnon () (LEFI - Laboratoire d'Economie de la Firme et des Institutions - Université Lumière - Lyon II)
Abstract

This paper intends to depart from a critique of the nexus of contracts theory of the firm endowed with its moral personification to propose some theoretical foundations of the firm as a real entity. Some old legal views of the corporation are mobilized to complete the conceptual vacuity of economic theories. This provides crucial insights for modern complex organizations such as the network-firm. The integrating and unifying role of intra-network power relationships is then emphasized and some law and economics of the network-firm are ultimately proposed to clarify the argument that the network-firm − as the firm stricto sensu − is a singular real entity composed from distinct legal entities.

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File URL: http://halshs.archives-ouvertes.fr/docs/00/37/49/78/PDF/Chassagnon_HAL2.pdf
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Paper provided by HAL in its series Post-Print with number halshs-00374978_v1.

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Date of creation: Jun 2008
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Publication status: Published - Presented, DRUID 25th Celebration International Conference 2008 on « Entrepreneurship and Innovation: Organizations, Institutions, Systems and Regions », 2008, Copenhague, Denmark
Handle: RePEc:hal:journl:halshs-00374978_v1

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Keywords: Law and economics; contract theory of the firm; network-firm; legal fiction; real entity;

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References listed on IDEAS
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  1. Raghuram G. Rajan & Luigi Zingales, 1998. "Power In A Theory Of The Firm," The Quarterly Journal of Economics, MIT Press, vol. 113(2), pages 387-432, May. [Downloadable!] (restricted)
    Other versions:
  2. Aghion, Philippe & Tirole, Jean, 1997. "Formal and Real Authority in Organizations," Journal of Political Economy, University of Chicago Press, vol. 105(1), pages 1-29, February.
    Other versions:
  3. John Davis, 2006. "Social identity strategies in recent economics," Journal of Economic Methodology, Taylor and Francis Journals, vol. 13(3), pages 371-390, September. [Downloadable!] (restricted)
    Other versions:
  4. Demsetz, Harold, 1988. "The Theory of the Firm Revisited," Journal of Law, Economics and Organization, Oxford University Press, vol. 4(1), pages 141-61, Spring.
  5. Gibbons, Robert, 2005. "Four forma(lizable) theories of the firm?," Journal of Economic Behavior & Organization, Elsevier, vol. 58(2), pages 200-245, October. [Downloadable!] (restricted)
  6. Silvia Sacchetti & Roger Sugden, 2003. "The Governance of Networks and Economic Power: The Nature and Impact of Subcontracting Relationships," Journal of Economic Surveys, Blackwell Publishing, vol. 17(5), pages 669-692, December. [Downloadable!] (restricted)
  7. Holmstrom, Bengt & Roberts, John, 1998. "The Boundaries of the Firm Revisited," Journal of Economic Perspectives, American Economic Association, vol. 12(4), pages 73-94, Fall. [Downloadable!] (restricted)
  8. Herbert A. Simon, 2002. "We and they: the human urge to identify with groups," Industrial and Corporate Change, Oxford University Press, vol. 11(3), pages 607-610, June.
  9. Langlois, Richard N., 2002. "Modularity in technology and organization," Journal of Economic Behavior & Organization, Elsevier, vol. 49(1), pages 19-37, September. [Downloadable!] (restricted)
  10. Moore, John, 1992. "The firm as a collection of assets," European Economic Review, Elsevier, vol. 36(2-3), pages 493-507, April. [Downloadable!] (restricted)
  11. Oliver E. Williamson, 2002. "The Lens of Contract: Private Ordering," American Economic Review, American Economic Association, vol. 92(2), pages 438-443, May. [Downloadable!]
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