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The Uneasy Organizational Matching Between Distribution of Knowledge, Divisionof Labor and Incentive Governance

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Author Info

  • Giovanni Dosi
  • Daniel Levinthal
  • Luigi Marengo

Abstract

In this paper we present a general model of organizational problem-solving in which organizations engage into an activity of cognition (understanding the world in which they operate) and an activity of action (implementing those policies which cognition indicates as targets which better fit the world s characteristics). Both cognition and action are adaptively determined as the organization faces limitations in the cognitive capabilities of its members and in its control functions. Interde-pendencies among relevant dimensions of the environment and among basic operational tasks are only partly understood. The model allows us to study various combinations of decompositions of cognition and action and various stylized reward systems. In particular, we can address issues of centralization vs. decentralization of cognition, production and rewards schemes and the possible complementarities among these choices.

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Bibliographic Info

Paper provided by Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy in its series LEM Papers Series with number 2002/26.

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Date of creation: 30 Dec 2002
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Handle: RePEc:ssa:lemwps:2002/26

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References

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  1. Giovanni Dosi & Daniel A. Levinthal & Luigi Marengo, 2003. "Bridging contested terrain: linking incentive-based and learning perspectives on organizational evolution," Industrial and Corporate Change, Oxford University Press, vol. 12(2), pages 413-436, April.
  2. Lane, David A, 1993. "Artificial Worlds and Economics, Part I," Journal of Evolutionary Economics, Springer, vol. 3(2), pages 89-107, May.
  3. Marengo, Luigi, et al, 2000. "The Structure of Problem-Solving Knowledge and the Structure of Organizations," Industrial and Corporate Change, Oxford University Press, vol. 9(4), pages 757-88, December.
  4. Page, Scott E, 1996. "Two Measures of Difficulty," Economic Theory, Springer, vol. 8(2), pages 321-46, August.
  5. Cohen, Michael D, et al, 1996. "Routines and Other Recurring Action Patterns of Organizations: Contemporary Research Issues," Industrial and Corporate Change, Oxford University Press, vol. 5(3), pages 653-98.
  6. Scott E. Page, 1996. "Two measures of difficulty (*)," Economic Theory, Springer, vol. 8(2), pages 321-346.
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Cited by:
  1. Leonardo Bargigli, 2005. "The limits of modularity in innovation and production," KITeS Working Papers 176, KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy, revised Sep 2005.
  2. Giovanni Dosi & Marco Faillo & Luigi Marengo, 2003. "Organizational Capabilities, Patterns of Knowledge Accumulation and Governance Structures in Business Firms. An Introduction," LEM Papers Series 2003/11, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
  3. Leonardo Bargigli, 2005. "An evolutionary model for the dynamics of vertical integration and network-based production," Industrial Organization 0509002, EconWPA.
  4. Stefano Brusoni & Luigi Marengo & Andrea Prencipe & Marco Valente, 2004. "The Value and Costs of Modularity: A Cognitive Perspective," SPRU Working Paper Series 123, SPRU - Science and Technology Policy Research, University of Sussex.

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