Theorien 2 Übersicht

Max Weber 1921

-Model of Bureaucracy

-4 Key Features of Bureaucracy (+ why beneficial)

-2 Disadvantages of Bureaucracy

-Contrast with Marx

Simon 1947

-Behavioural theory of the firm: The Equlibrium of the Corporation

-Decision Making, Satisficing & Bounded Rationality (+ why participate in the firm)

-Humans are “intendedly rational, but only limitedly so”

Ronald Coase 1937

-If markets are so good at allocationg resources, why do we need firms?

-3 costs to using the market/price mechanism

-Where are the boundaries of the firm?

Williamson 1981

-Builds on Coase 1937 -> Predicts the conditions under which firms or markets would be preferred -> Making Transaction cost theory operational

-Made two key assumptions

-Three dimensions of transactions

-Trade-off

Zenger 2011

-Why is not all production carried out by one firm? What keeps firms from expanding from their boundaries?

-3 behavioural impediments to firm growth

-Market-Hierarchy Hybrid (-> Haier)

Adam Smith (1776)

-The Wealth of Nations

-Attention to Agency Problem

-Scale of 20th corporation brought attention to this issue

Jensen & Meckling 1976

-Agency Theory

-Resolving two problems

-3 Solutions to the agency problem

Miller 2008

-Co-operation as solution to agency problem

Frydman & Saks 2010

-Senior executive pay

Jensen & Murphy 1990

-Empirical evidence -> Failed to establish link between executive pay and stock price performance as predicted by agency theory

Pepper 2019

-Criticism of agency theory -> Right diagnosis, wrong solution

-Intrinsic vs. extrinsic motivation (Extrinsic incentives can crowd out intrinsic motivation)

-Haier (Market-Hierarchy Hybrid)

-Enron (As a cautionary tale)