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Heterogeneous Capital, Entrepreneurship, and Economic Organization

Author

Listed:
  • Nicolai Foss
  • Kirsten Foss
  • Peter G. Klein
  • Sandra K. Klein

Abstract

One of Israel Kirzners less wellknown contributions is to the theory of capital. In this paper, we link the Austrian theory of capital and the theory of economic organization. Our starting point is the key Austrian notion of capital heterogeneity which we interpret in terms of attributes. Most capital assets are multi-attribute in nature, and many attributes may not be known to entrepreneurs. This fosters a need for experimenting with capital combinations. Because there are costs of measuring attributes, this process has implications for economic organization. Thus, we argue that novel implications for the understanding of ownership and the existence and boundaries of firms may be teased out of such a perspective.La théorie du capital représente une des contributions les moins connues dIsrael Kirzner. Dans cet article, nous établissons le lien entre la théorie autrichienne du capital et la théorie de lorganisation économique. Notre point de départ est la notion autrichienne fondamentale dhétérogénéité du capital que nous interprétons en termes dattributs. De par leur nature, la plupart des biens capitaux possèdent plusieurs attributs qui peuvent demeurer inconnus aux entrepreneurs. Ceci accroît la nécessité dexpérimenter des combinaisons capitalistiques. Etant donné les coûts quentraîne la mesure des attributs, ce processus a des implications quant à lorganisation économique. Ainsi, cette perspective permet de tirer de nouvelles implications pour notre compréhension de la propriété, de lexistence et de la taille des firmes.
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Suggested Citation

  • Nicolai Foss & Kirsten Foss & Peter G. Klein & Sandra K. Klein, "undated". "Heterogeneous Capital, Entrepreneurship, and Economic Organization," IVS/CBS Working Papers 2002-02, Department of Industrial Economics and Strategy, Copenhagen Business School.
  • Handle: RePEc:ivs:iivswp:02-02
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    References listed on IDEAS

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    Cited by:

    1. Stefan W. Schmitz, 2004. "Uncertainty in the Austrian Theory of Capital," The Review of Austrian Economics, Springer;Society for the Development of Austrian Economics, vol. 17(1), pages 67-85, March.
    2. Nicolai J. Foss & Peter G. Klein, 2004. "Entrepreneurshoip and the Economic Theory of the Firm Any Gains from Trade?," DRUID Working Papers 04-12, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.

    More about this item

    JEL classification:

    • B20 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - General
    • B53 - Schools of Economic Thought and Methodology - - Current Heterodox Approaches - - - Austrian
    • D2 - Microeconomics - - Production and Organizations

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