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Governance Structures, Cultural Distance, and Socialization Dynamics: Further Challenges for the Modern Corporation

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  • Schwesinger, Georg
  • Müller, Stephan
  • Lundan, Sarianna M.

Abstract

This paper relates cultural distance and governance structures. We suggest a model of cultural evolution that captures the idiosyncratic socialization dynamics taking place in groups of communicating and interacting agents. Based on these processes, cultural distance within and between groups or organizational units develops. Transaction cost theorists associate higher cultural distance with higher transaction costs. Therefore, one problem of economic organization is assessing alternative governance structures in terms of the socialization dynamics they enable that entail different intraorganizational transaction costs. We assume that transaction can be organized within governance structures that allow transaction cost economizing socialization processes.

Suggested Citation

  • Schwesinger, Georg & Müller, Stephan & Lundan, Sarianna M., 2016. "Governance Structures, Cultural Distance, and Socialization Dynamics: Further Challenges for the Modern Corporation," Annual Conference 2016 (Augsburg): Demographic Change 145907, Verein für Socialpolitik / German Economic Association.
  • Handle: RePEc:zbw:vfsc16:145907
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    References listed on IDEAS

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    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis

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