https://www.sfu.ca/~wainwrig/Econ400/jensen-meckling.pdf

Theory of the firm: Managerial behavior, agency costs and ownership structure

Firm Resources and Sustained Competitive Advantage

What makes organizations so similar? We contend that the engine of rationalization and bureaucratization has moved from the competitive marketplace to the state and the professions. Once a set of organizations emerges as a field, a paradox arises: rational actors make their organizations increasingly similar as they try to change them. We describe three isomorphic processes-coercive, mimetic, and normative—leading to this outcome. We then specify hypotheses about the impact of resource centralization and dependency, goal ambiguity and technical uncertainty, and professionalization and structuration on isomorphic change. Finally, we suggest implications for theories of organizations and social change.

/pdf/the-iron-cage-revisited-institutional-isomorphism-and-xas5qn5nhy.pdf

The iron cage revisited institutional isomorphism and collective rationality in organizational fields

In this paper, the concept of social capital is introduced and illustrated, its forms are described, the social structural conditions under which it arises are examined, and it is used in an analys...

/pdf/social-capital-in-the-creation-of-human-capital-1836wo2872.pdf

Social Capital in the Creation of Human Capital

In this paper, we argue that the ability of a firm to recognize the value of new, external information, assimilate it, and apply it to commercial ends is critical to its innovative capabilities. We label this capability a firm's absorptive capacity and suggest that it is largely a function of the firm's level of prior related knowledge. The discussion focuses first on the cognitive basis for an individual's absorptive capacity including, in particular, prior related knowledge and diversity of background. We then characterize the factors that influence absorptive capacity at the organizational level, how an organization's absorptive capacity differs from that of its individual members, and the role of diversity of expertise within an organization. We argue that the development of absorptive capacity, and, in turn, innovative performance are history- or path-dependent and argue how lack of investment in an area of expertise early on may foreclose the future development of a technical capability in that area. We formulate a model of firm investment in research and development (R&D), in which R&D contributes to a firm's absorptive capacity, and test predictions relating a firm's investment in R&D to the knowledge underlying technical change within an industry. Discussion focuses on the implications of absorptive capacity for the analysis of other related innovative activities, including basic research, the adoption and diffusion of innovations, and decisions to participate in cooperative R&D ventures. **

/pdf/absorptive-capacity-a-new-perspective-on-learning-and-1n1c9gg9x0.pdf

Absorptive capacity: a new perspective on learning and innovation

I argue here, as I have previously, that technology is neither fully determinative of nor irrelevant to economic organization. Transaction cost economizing occupies a prominent position in any effort to assess the efficacy of alternative forms of economic organization.

Technology and transaction cost economics: A reply

Numerous significant past and recent contributions to the literature on the efficacy of corporate boards of directors notwithstanding, a consensus has yet to develop. Partly this is due to a failure to agree on the ground rules, to which the use of different lenses through which to observe and interpret corporate boards is a contributing factor. This article examines corporate boards through the lens of contract/governance with the object of (1) uncovering the factors that are responsible for the intrinsic limitations of boards in monitoring and managing respects and, in consideration of these limitations, (2) advising on the merits of proposed reforms, to which credibility considerations and the integrity of delegation are relevant. A more accepting interpretation of practices regarded by many as problematic emerges, but not without qualifications and express concern for bad actors. (JEL G30, G34, K22, L14)

Corporate Boards of Directors: In Principle and in Practice

Whether troublesome antitrust issues are posed when vertical restraints are placed on distributors by manufacturers has long been disputed. Although economic analysis is needed to assess the ramifications of such restraints, this analysis comes in a variety of forms and does not speak with one voice to these issues. Defective economic reasoning predictably leads to results that are inimical to economic efficiency and sound public policy. Such was the case when franchise restrictions were held anticompetitive in United States v. Arnold, Schwinn & Co.' This Article develops the argument that failure to make express allowances for transaction cost considerations is responsible for mistaken public policy in this area. The transaction cost approach applies symmetrically both to an assessment of the efficiency gains, if any, arising from vertical restraints and to an evaluation of the strategic purposes and effects, if any, that accompany such restraints. After developing the justifications for, and occasional anticompetitive effects of, vertical market restrictions, I will suggest guidelines for federal antitrust policy. Part I outlines the general transaction cost approach and concludes that antitrust enforcement agencies and the courts should assume that vertical market restrictions are efficiency-enhancing unless certain structural conditions exist within the industry. Part II discusses strategic behavior and the structural characteristics of industries needed to support strategic outcomes. Vertical restraints pose troublesome antitrust issues only when these

/pdf/assessing-vertical-market-restrictions-antitrust-2txmxrn8zp.pdf

Oliver E. Williamson

Papers

Technology and transaction cost economics: A reply

Corporate Boards of Directors: In Principle and in Practice

Assessing Vertical Market Restrictions: Antitrust Ramifications of the Transaction Cost Approach

Les institutions de l'économie

Visible and invisible governance