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Indirect Pricing Theory Of The Firm: A General-Equilibrium Analysis Involving Production Technology And Management Service


  • Guo-qiang Li
  • Yew-Kwang Ng


This paper develops a general-equilibrium model that involves production technology and management service to study the emergence of firms from the perspective of saving transaction costs. Inframarginal analysis is used to formalize Coase and Cheung's theory of the firm and to generalize Yang and Ng's indirect pricing theory of the firm. Not only the emergence of firms, their growth and contraction, but also the relevant conditions for the existence of technology entrepreneurs and professional management are also investigated. Copyright 2007 The Authors Journal compilation 2007 Blackwell Publishing Ltd

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  • Guo-qiang Li & Yew-Kwang Ng, 2007. "Indirect Pricing Theory Of The Firm: A General-Equilibrium Analysis Involving Production Technology And Management Service," Pacific Economic Review, Wiley Blackwell, vol. 12(1), pages 129-148, February.
  • Handle: RePEc:bla:pacecr:v:12:y:2007:i:1:p:129-148

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    References listed on IDEAS

    1. Goldstein, Morris & Khan, Mohsin S., 1985. "Income and price effects in foreign trade," Handbook of International Economics,in: R. W. Jones & P. B. Kenen (ed.), Handbook of International Economics, edition 1, volume 2, chapter 20, pages 1041-1105 Elsevier.
    2. Hooper, Peter & Kohlhagen, Steven W., 1978. "The effect of exchange rate uncertainty on the prices and volume of international trade," Journal of International Economics, Elsevier, vol. 8(4), pages 483-511, November.
    3. Yin-Wong Cheung, 2005. "An Analysis Of Hong Kong Export Performance," Pacific Economic Review, Wiley Blackwell, vol. 10(3), pages 323-340, October.
    4. Cheung, Yin-Wong & Lai, Kon S, 1993. "Finite-Sample Sizes of Johansen's Likelihood Ration Tests for Conintegration," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 55(3), pages 313-328, August.
    5. Cheung, Yin-Wong & Lai, Kon S, 1995. "Lag Order and Critical Values of the Augmented Dickey-Fuller Test," Journal of Business & Economic Statistics, American Statistical Association, vol. 13(3), pages 277-280, July.
    6. Agathe Cote, "undated". "Exchange Rate Volatility and Trade: A Survey," Staff Working Papers 94-5, Bank of Canada.
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