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The Size of the Firm and Social Division of Labour

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  • Guang‐Zhen Sun

Abstract

This paper develops a formal model with transaction costs and economies of specialisation to address the size of the firm and the level of social division of labour. It is shown that the increase of the level of social division of labour and the decline of firm size may concur, and that the size of the firm crucially depends on, among other things, the relative transaction efficiency of the labour market with that of the markets for intermediate products.

Suggested Citation

  • Guang‐Zhen Sun, 2000. "The Size of the Firm and Social Division of Labour," Australian Economic Papers, Wiley Blackwell, vol. 39(3), pages 263-277, September.
    • Handle: RePEc:bla:ausecp:v:39:y:2000:i:3:p:263-277
    DOI: 10.1111/1467-8454.00090
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    Cited by:

    1. Zhang, Yongsheng & Zhao, Xueyan, 2004. "Testing the scale effect predicted by the Fujita-Krugman urbanization model," Journal of Economic Behavior & Organization, Elsevier, vol. 55(2), pages 207-222, October.

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