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Social Science Research Network 

About: Social Science Research Network is an academic journal. The journal publishes majorly in the area(s): Corporate governance & Population. Over the lifetime, 551804 publication(s) have been published receiving 10854816 citation(s). The journal is also known as: SSRN &

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Abstract: Examines the role that institutions, defined as the humanly devised constraints that shape human interaction, play in economic performance and how those institutions change and how a model of dynamic institutions explains the differential performance of economies through time. Institutions are separate from organizations, which are assemblages of people directed to strategically operating within institutional constraints. Institutions affect the economy by influencing, together with technology, transaction and production costs. They do this by reducing uncertainty in human interaction, albeit not always efficiently. Entrepreneurs accomplish incremental changes in institutions by perceiving opportunities to do better through altering the institutional framework of political and economic organizations. Importantly, the ability to perceive these opportunities depends on both the completeness of information and the mental constructs used to process that information. Thus, institutions and entrepreneurs stand in a symbiotic relationship where each gives feedback to the other. Neoclassical economics suggests that inefficient institutions ought to be rapidly replaced. This symbiotic relationship helps explain why this theoretical consequence is often not observed: while this relationship allows growth, it also allows inefficient institutions to persist. The author identifies changes in relative prices and prevailing ideas as the source of institutional alterations. Transaction costs, however, may keep relative price changes from being fully exploited. Transaction costs are influenced by institutions and institutional development is accordingly path-dependent. (CAR)

25,990 citations

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Abstract: This study develops an evolutionary theory of the capabilities and behavior of business firms operating in a market environment. It includes both general discussion and the manipulation of specific simulation models consistent with that theory. The analysis outlines the differences between an evolutionary theory of organizational and industrial change and a neoclassical microeconomic theory. The antecedents to the former are studies by economists like Schumpeter (1934) and Alchian (1950). It is contrasted with the orthodox theory in the following aspects: while the evolutionary theory views firms as motivated by profit, their actions are not assumed to be profit maximizing, as in orthodox theory; the evolutionary theory stresses the tendency of most profitable firms to drive other firms out of business, but, in contrast to orthodox theory, does not concentrate on the state of industry equilibrium; and evolutionary theory is related to behavioral theory: it views firms, at any given time, as having certain capabilities and decision rules, as well as engaging in various ‘search' operations, which determines their behavior; while orthodox theory views firm behavior as relying on the use of the usual calculus maximization techniques. The theory is then made operational by the use of simulation methods. These models use Markov processes and analyze selection equilibrium, responses to changing factor prices, economic growth with endogenous technical change, Schumpeterian competition, and Schumpeterian tradeoff between static Pareto-efficiency and innovation. The study's discussion of search behavior complicates the evolutionary theory. With search, the decision making process in a firm relies as much on past experience as on innovative alternatives to past behavior. This view combines Darwinian and Lamarkian views on evolution; firms are seen as both passive with regard to their environment, and actively seeking alternatives that affect their environment. The simulation techniques used to model Schumpeterian competition reveal that there are usually winners and losers in industries, and that the high productivity and profitability of winners confer advantages that make further success more likely, while decline breeds further decline. This process creates a tendency for concentration to develop even in an industry initially composed of many equal-sized firms. However, the experiments conducted reveal that the growth of concentration is not inevitable; for example, it tends to be smaller when firms focus their searches on imitating rather than innovating. At the same time, industries with rapid technological change tend to grow more concentrated than those with slower progress. The abstract model of Schumpeterian competition presented in the study also allows to see more clearly the public policy issues concerning the relationship between technical progress and market structure. The analysis addresses the pervasive question of whether industry concentration, with its associated monopoly profits and reduced social welfare, is a necessary cost if societies are to obtain the benefits of technological innovation. (AT)

22,526 citations

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TL;DR: The Satisfaction With Life Scale is narrowly focused to assess global life satisfaction and does not tap related constructs such as positive affect or loneliness, but is shown to have favorable psychometric properties, including high internal consistency and high temporal reliability.
Abstract: This article reports the development and validation of a scale to measure global life satisfaction, the Satisfaction With Life Scale (SWLS). Among the various components of subjective well-being, the SWLS is narrowly focused to assess global life satisfaction and does not tap related constructs such as positive affect or loneliness. The SWLS is shown to have favorable psychometric properties, including high internal consistency and high temporal reliability. Scores on the SWLS correlate moderately to highly with other measures of subjective well-being, and correlate predictably with specific personality characteristics. It is noted that the SWLS is suited for use with different age groups, and other potential uses of the scale are discussed.

18,785 citations

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Abstract: This paper examines legal rules covering protection of corporate shareholders and creditors, the origin of these rules, and the quality of their enforcement in 49 countries. The results show that common law countries generally have the best, and French civil law countries the worst, legal protections of investors, with German and Scandinavian civil law countries located in the middle. We also find that concentration of ownership of shares in the largest public companies is negatively related to investor protections, consistent with the hypothesis that small, diversified shareholders are unlikely to be important in countries that fail to protect their rights.

13,910 citations

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Abstract: Discusses the key role of organizational leadership in organizational culture, and the intertwining problems associated with each. Organizational culture is defined as the basic assumptions and beliefs shared by members of an organization. These are learned, operate unconsciously, and essentially define an organization's view of itself and its environment. Though cultural differences are reflected in companies, each company also has an individual culture that modifies local or national cultures. Origins of culture are discussed, especially the entrepreneur's effect on cultural formation, and mechanisms of embedding and reinforcing cultural standards as a means of guiding an evolving company. Taking an interdisciplinary perspective, the book analyzes the maturing research in the field of organization studies - the available ethnographic methods, participant observation, qualitative research, and clinical research. Results indicate that culture functions to solve an organization's basic problems of (a) surviving in the external environment and (b) integrating its internal processes to ensure its continued survival. Since the organizational structure and people's attitudes and perceptions constitute key artifacts of a culture, both these must be changed before the company's overarching cultural change can occur. Typically, change begins at the formative stage as a positive growth force in need of development, evolves into a complex, diverse model of culture, and finally at the point of maturation, often becomes dysfunctional. It is at this point that the leader-usually the entrepreneur - is most crucial, often turning to various change models as a means of sustaining the company. Though the leader's role in cultural formation shifts, such purposeful, foundational change in an organization only occurs rarely in mature companies and under effective leadership. In sum, cultural leadership - and especially the role of the cultural manager - needs to be assessed more clearly in light of the organization's rapidly changing internal and external environment. (CJC)

13,222 citations

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