theory of the firm
E455284
The theory of the firm is an economic framework that explains why firms exist, how they are structured, and what determines their boundaries and behavior in markets, particularly in relation to transaction costs and contractual arrangements.
All labels observed (1)
| Label | Occurrences |
|---|---|
| theory of the firm canonical | 1 |
Statements (105)
| Predicate | Object |
|---|---|
| instanceOf |
economic theory
ⓘ
microeconomic theory ⓘ theory in economics ⓘ |
| addressesQuestion |
How do firms behave and compete in different market structures?
ⓘ
How should firms be structured to minimize costs and align incentives? ⓘ What determines the boundaries between firms and markets? ⓘ Why do firms exist instead of all production being organized through markets? ⓘ |
| field |
industrial organization
ⓘ
institutional economics ⓘ managerial economics ⓘ microeconomics ⓘ |
| hasApproach |
Coasian theory of the firm
NERFINISHED
ⓘ
agency theory of the firm ⓘ behavioral theory of the firm ⓘ contractual theory of the firm ⓘ dynamic capabilities view of the firm ⓘ evolutionary theory of the firm ⓘ institutional theory of the firm ⓘ knowledge-based theory of the firm ⓘ managerial theory of the firm ⓘ neoclassical theory of the firm ⓘ property rights theory of the firm NERFINISHED ⓘ relational view of the firm ⓘ resource-based view of the firm ⓘ transaction cost theory of the firm ⓘ |
| keyConcept |
X-inefficiency
ⓘ
adverse selection ⓘ asset specificity ⓘ bounded rationality ⓘ capabilities ⓘ economies of scale ⓘ economies of scope ⓘ firm-specific assets ⓘ governance structures ⓘ hierarchies ⓘ hold-up problem ⓘ hybrid governance forms ⓘ incomplete contracts ⓘ knowledge integration ⓘ managerial discretion ⓘ markets ⓘ moral hazard ⓘ opportunism ⓘ organizational learning ⓘ organizational slack ⓘ principal–agent problem ⓘ profit maximization assumption ⓘ residual control rights ⓘ residual income rights ⓘ routines ⓘ satisficing behavior ⓘ transaction costs ⓘ |
| relatedTo |
Armen Alchian
NERFINISHED
ⓘ
Edith Penrose NERFINISHED ⓘ Harold Demsetz NERFINISHED ⓘ James March NERFINISHED ⓘ Joseph Schumpeter NERFINISHED ⓘ Michael Jensen NERFINISHED ⓘ Oliver Williamson NERFINISHED ⓘ Richard Cyert NERFINISHED ⓘ Ronald Coase NERFINISHED ⓘ William Meckling NERFINISHED ⓘ |
| studies |
agency problems
ⓘ
behavior of firms in markets ⓘ boundaries of firms ⓘ competition between firms ⓘ contractual arrangements within firms ⓘ coordination of specialized assets ⓘ coordination within firms ⓘ corporate governance ⓘ cost minimization ⓘ dynamic capabilities of firms ⓘ entrepreneurial function of firms ⓘ existence of firms ⓘ firm boundaries in relation to markets ⓘ firm decision-making ⓘ firm growth ⓘ firm size ⓘ hierarchies and authority in firms ⓘ incomplete contracts ⓘ innovation within firms ⓘ internal organization of firms ⓘ knowledge and information within firms ⓘ long-term contracts ⓘ make-or-buy decisions ⓘ market power of firms ⓘ market–hierarchy trade-off ⓘ monitoring and incentives in firms ⓘ organizational structure of firms ⓘ output decisions ⓘ outsourcing decisions ⓘ ownership structure of firms ⓘ pricing decisions ⓘ principal–agent relationships ⓘ production decisions ⓘ profit maximization ⓘ property rights allocation ⓘ relational contracts ⓘ relationship between firms and markets ⓘ resource allocation within firms ⓘ risk-bearing by firms ⓘ routines and capabilities of firms ⓘ team production ⓘ transaction costs ⓘ vertical integration ⓘ |
Referenced by (1)
Full triples — surface form annotated when it differs from this entity's canonical label.