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Allocation of Economic Competence in Teams: A Comparative Institutional Analysis

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  • Pelikan, Pavel

    (The Research Institute of Industrial Economics)

Abstract

Attention is called to a little explored scarce resource, termed 'economic competence', which combines features of human capital and bounded rationality, and causes a singularity in resource-allocation in society. The performance of each economy is shown to strongly depend on how this resource is allocated, which in turn strongly depends upon the economy's institutions ('rules of the game'). Two stylized institutional variants of market selection and one of government selection are compared for their short-term and long-term effects upon the output and growth of a perfect team economy. The results are exemplified by throwing new light on the social value of financial markets and the limitations of industrial policies.

Suggested Citation

  • Pelikan, Pavel, 1997. "Allocation of Economic Competence in Teams: A Comparative Institutional Analysis," Working Paper Series 480, Research Institute of Industrial Economics.
  • Handle: RePEc:hhs:iuiwop:0480
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    References listed on IDEAS

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    Cited by:

    1. Gerhard Wegner, 1998. "Environmental (De-) Regulation, Competition, and Policy Rules," Constitutional Political Economy, Springer, vol. 9(3), pages 213-234, September.
    2. Pelikan, Pavel, 2006. "Markets vs. Government when Rationality Is Unequally Bounded: Some Consequences of Cognitive Inequalities for Theory and Policy," Ratio Working Papers 85, The Ratio Institute, revised 03 Sep 2006.
    3. Pelikan, Pavel, 2004. "Interconnecting Ecolutionary, Institutional and Cognitive Economics: Six Steps towards Understanding the Six Links," Ratio Working Papers 48, The Ratio Institute.
    4. Pelikan, Pavel, 1999. "Institutions for the Selection of Entrepreneurs: Implications for Economic Growth and Financial Crises," Working Paper Series 510, Research Institute of Industrial Economics, revised 15 Feb 2000.
    5. Pelikan, Pavel, 2008. "The government economic agenda in a society of unequally rational individuals," MPRA Paper 19127, University Library of Munich, Germany, revised 06 Dec 2009.
    6. Martin, Pardupa, 2007. "Cooperation or rivalry? Employee’s effort and appropriate knowledge distribution as key elements for maximizing the profit of the firm," MPRA Paper 26428, University Library of Munich, Germany.

    More about this item

    Keywords

    Economic competence; Human capital; Bounded rationality; Institutions; Entrepreneurs; Investors; Government; Market selection; Financial Markets; Industrial policies;

    JEL classification:

    • D20 - Microeconomics - - Production and Organizations - - - General
    • D92 - Microeconomics - - Micro-Based Behavioral Economics - - - Intertemporal Firm Choice, Investment, Capacity, and Financing
    • H10 - Public Economics - - Structure and Scope of Government - - - General
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • P51 - Economic Systems - - Comparative Economic Systems - - - Comparative Analysis of Economic Systems

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