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Williamson (1991) - Comparative Economic Organization The Analysis Of Discrete Structural Alternatives (view source)
Revision as of 18:34, 12 June 2010
, 18:34, 12 June 2010→Adaptation
===Adaptation===
Economic problems arise as a consequence of change. The price system is an efficient mechanism (in the market) for communicating information and inducing change (Hayek 1945). However, firms also adapt to change (Barnard 1938), and concious, deliberate, and purposeful cooperation is realized through formal organization (firms). When the price is a sufficient statistic, then the market excels. The sort of adaptation that are supported through price signals are autonomous (<math>A\,</math>) changes. However, some disturbances require coordinated responses, lest the components operate at cross purposes. These are <math>C\,</math> changes. Problems in addressing <math>C \,</math> changes include:
*If one party coordinates, then they may use their position strategically for their own gain
**They may distort information, or disclose it selectively or incompletely.
*Maladaption itself is costly.
Fiat has advantages for <math>C\,</math> changes.
===Instruments===
