Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/3208
Authors: 
Lindbeck, Assar
Snower, Dennis J.
Year of Publication: 
2004
Series/Report no.: 
CEPR Discussion Paper Series, Centre for Economic Policy Research (CEPR), London 4242
Abstract: 
This Paper presents a new approach to the theory of the firm by identifying factor complementarities as central to the determination of the firm’s boundaries. The factor complementarities may take a variety of forms: technological and informational complementarities, as well as economies of scale and scope. We examine the trade-off between the gains from these complementarities and transactions costs. In so doing, we must abandon the standard dichotomy between the determinants of plant size and firm size. The influence of factor complementarities on firm size is examined in partial and general equilibrium frameworks.
JEL: 
D21
D23
Document Type: 
Working Paper

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