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Notes on Institutional Complementarities and Organizational Forms

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  • Erkan Gürpinar

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Abstract

This paper analyses the concept of organizational forms, and derives some implications for the economics of production organization. To this end, after pointing out the role of knowledge in the organization of production, we discuss the theories based on technology (new institutional economics) and property rights (so-called radical school). When the effect of property rights is not taken into account, technology alone entails unique solution to the problem of production organization. After ruling out this technologically deterministic argument, by recourse to a simple model, we study the complementarities between these two domains. Finally, we derive some implications: (a) the asymmetry between the characteristics of labour and capital under the existing property relations, (b) the importance of workers’ preferences for different ways of production organization. In so doing, we show that efficiency driven arguments on the relative success of different organizational forms may be misleading. Hence, we argue that, change in production organization should be described not as a linear path, but rather as a branching tree.

Suggested Citation

  • Erkan Gürpinar, 2013. "Notes on Institutional Complementarities and Organizational Forms," Department of Economics University of Siena 678, Department of Economics, University of Siena.
  • Handle: RePEc:usi:wpaper:678
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    References listed on IDEAS

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    1. Mokyr, Joel, 1990. "Punctuated Equilibria and Technological Progress," American Economic Review, American Economic Association, pages 350-354.
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    5. Marianna Belloc & Samuel Bowles, 2009. "International Trade, Factor Mobility and the Persistence of Cultural-Institutional Diversity," UMASS Amherst Economics Working Papers 2009-08, University of Massachusetts Amherst, Department of Economics.
    6. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    7. Elster,Jon, 1983. "Explaining Technical Change," Cambridge Books, Cambridge University Press, number 9780521270724, December.
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    9. J. Stan Metcalfe, 2010. "Technology and economic theory," Cambridge Journal of Economics, Oxford University Press, vol. 34(1), pages 153-171, January.
    10. Simon, Herbert A, 1979. "Rational Decision Making in Business Organizations," American Economic Review, American Economic Association, pages 493-513.
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    14. Pagano, Ugo & Rowthorn, Robert, 1994. "Ownership, technology and institutional stability," Structural Change and Economic Dynamics, Elsevier, vol. 5(2), pages 221-242, December.
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    16. Ernesto Screpanti, 2011. "Freedom of Choice in the Production Sphere: The Capitalist and the Self-managed Firm," Review of Political Economy, Taylor & Francis Journals, vol. 23(2), pages 267-279.
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    More about this item

    Keywords

    Technology; Transaction costs; Property rights; Institutional complementarities; Organizational forms;

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • J54 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Producer Cooperatives; Labor Managed Firms
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • P14 - Economic Systems - - Capitalist Systems - - - Property Rights

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