IDEAS home Printed from
   My bibliography  Save this paper

Specific knowledge, investment decision and organizational architecture


  • Ghazi Zouari

    (Fseg Sfax, LEG-Fargo)


Within the theoretical framework of organizational architecture, this paper attempts to explain the decentralization of investment decision. To do so, it highlights the role of the allocation of decision rights and control as a factor explaining the effectiveness of investment management. Thus, the object of this research is, first, to strengthen the relevance of the theoretical corpus of Fama and Jensen (1983a, 1983b) and Jensen and Meckling (1992), and, secondly, to replicate the studies by Noda and Bower (1996), Fahmi (1999) and Catelin (2001) and extend them to the Tunisian context. The Tunisian example is relevant because of the lack of research on the topic for this country, and also because this research could improve decision making for investment in the current context of Tunisia. We show that the role played by organizational complexity, information and communication technology, training programs, and evaluation and incentive systems in the creation of value requires the setting of a centralized organizational structure. An empirical test was conducted on a sample of 63 Tunisian firms by using canonical analysis. This test allowed the validation of four out of the five tested hypotheses.

Suggested Citation

  • Ghazi Zouari, 2011. "Specific knowledge, investment decision and organizational architecture," Working Papers CREGO 1110501, Université de Bourgogne - CREGO EA7317 Centre de recherches en gestion des organisations.
  • Handle: RePEc:dij:wpfarg:1110501

    Download full text from publisher

    File URL:
    Download Restriction: no

    References listed on IDEAS

    1. Gérard Charreaux, 2004. "Michael Jensen-la théorie positive de l’agence et ses applications à l’architecture et à la gouvernance des organisations," Working Papers CREGO 1041203, Université de Bourgogne - CREGO EA7317 Centre de recherches en gestion des organisations.
    2. Fama, Eugene F & Jensen, Michael C, 1983. "Separation of Ownership and Control," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 301-325, June.
    3. Park, Albert & Shen, Minggao, 2008. "Refinancing and decentralization: Evidence from China," Journal of Economic Behavior & Organization, Elsevier, vol. 66(3-4), pages 703-730, June.
    4. Wruck, Karen Hopper & Jensen, Michael C., 1994. "Science, specific knowledge, and total quality management," Journal of Accounting and Economics, Elsevier, vol. 18(3), pages 247-287, November.
    5. James A. Brickley & Clifford W. Smith & Jerold L. Zimmerman, 2003. "Corporate Governance, Ethics, And Organizational Architecture," Journal of Applied Corporate Finance, Morgan Stanley, vol. 15(3), pages 34-45.
    6. James A. Brickley & Clifford W. Smith & Jerold L. Zimmerman, 1997. "Management Fads And Organizational Architecture," Journal of Applied Corporate Finance, Morgan Stanley, vol. 10(2), pages 24-39.
    7. repec:dau:papers:123456789/654 is not listed on IDEAS
    8. Ghazi Zouari, 2011. "The corporate investment decision process and control systems," International Journal of Economic Policy in Emerging Economies, Inderscience Enterprises Ltd, vol. 4(1), pages 20-53.
    9. Demsetz, Harold, 1988. "The Theory of the Firm Revisited," Journal of Law, Economics, and Organization, Oxford University Press, vol. 4(1), pages 141-161, Spring.
    Full references (including those not matched with items on IDEAS)

    More about this item


    investment decision; organizational architecture (decisional rights; control system).;

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:dij:wpfarg:1110501. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Angèle RENAUD). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.