The DOI matches its Crossref record; 17 of the 17 references it cites were found in a registry or an index.
HETEROGENEOUS FIRMS AND THE ORGANIZATION OF PRODUCTION
Abstract
Firms in the same industry exhibit systematic differences in the organization of production and the structure of employment. Entrepreneurial ability is the specific scarce input that limits the size of a firm. This input must be allocated to two activities, coordinating production and monitoring workers. Able entrepreneurs can convert calendar time into larger supplies of coordinating effort that enable them to assemble large firms. Greater ability implies a higher shadow price of time which increases the implicit costs of monitoring. A dispersion of entrepreneurial abilities generates an equilibrium size distribution of firms. Differences in monitoring costs affect the choice of worker productivities, the design of products, and the organization of production. The monitoring cost hypothesis advanced in this paper goes a long way in explaining the equilibrium of an industry containing heterogeneous firms that differ in size and behavior.
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Cites
Theory of the firm: Managerial behavior, agency costs and ownership structure
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A Theory of the Allocation of Time
Becker, G. S. (1965) · The Economic Journal · doi:10.2307/2228949 · Cited by 10,354
Transaction-Cost Economics: The Governance of Contractual Relations
Williamson, O. E. (1979) · The Journal of Law and Economics · doi:10.1086/466942 · Cited by 10,190
Production, Information Costs and Economic Organization
Alchian, A. A., & Demsetz, H. (1996) · Firms, Organizations and Contracts · doi:10.1093/oso/9780198774358.003.0005 · Cited by 9,565
Vertical Integration, Appropriable Rents, and the Competitive Contracting Process
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Theory of the firm; managerial Behavior, Agency Costs, and Ownership Structure
Jensen, M. C., & Meckling, W. H. (1996) · Firms, Organizations and Contracts · doi:10.1093/oso/9780198774358.003.0006 · Cited by 4,245
On the Size Distribution of Business Firms
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Information in the Labor Market
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Hierarchical Control and Optimum Firm Size
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Cited by
The resource‐based view within the conversation of strategic management
Mahoney, J. T., & Pandian, J. R. (1992) · Strategic Management Journal · doi:10.1002/smj.4250130505 · Cited by 3,392
Men and Women at Work: Sex Segregation and Statistical Discrimination
Bielby, W. T., & Baron, J. N. (1986) · American Journal of Sociology · doi:10.1086/228350 · Cited by 907
Specific Capital, Mobility, and Wages: Wages Rise with Job Seniority
Topel, R. (1990) · National Bureau of Economic Research · doi:10.3386/w3294 · Cited by 721
Discrimination in an Equilibrium Search Model
Black, D. A. (1995) · Journal of Labor Economics · doi:10.1086/298376 · Cited by 353
Metadata
- Authors
- OI, W. Y.
- Venue
- Economic Inquiry
- Publisher
- Wiley
- Published
- 1983-04
- Volume
- 21
- Issue
- 2
- Pages
- 147-171
- ISSN
- 0043-3640 (ISSN-L)
- 0095-2583
- 1465-7295
- OpenAlex
- W1995242665
- Cited by
- 272
- References
- 17
- FWCI
- 27.27
- Type
- journal article
- Language
- en
- Open access
- closed
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Contains information from the Semantic Scholar Academic Graph Datasets, made available under the ODC Attribution License (ODC-BY 1.0).
Semantic Scholar’s data is described in: Kinney, R., et al. (2023). The Semantic Scholar Open Data Platform. arXiv:2301.10140.
