Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/104261
Authors: 
Schlicht, Ekkehart
Year of Publication: 
2008
Series/Report no.: 
Munich Discussion Paper 2008-20
Abstract: 
Internal organization relies heavily on psychological consistency requirements. This perspective has been emphasized in modern compensation theory, but has not been extended to organization theory. The idea is developed by starting from Williamson's discussion of idiosyncratic exchange. The perspective sheds new light on several topics in the theory of the firm, like the boundaries of the firm (“Williamson's puzzle”), the importance of fairness concerns within firms, the attenuation of incentives, or the role of routines. It implies a “perceptional” theory of the firm that is “realistic” in the sense advocated by Coase (1937).
Subjects: 
theory of the firm
hierarchy
evolutionary theory of the firm
perceptional theory of the firm
consistency
small numbers
centralization paradox
Williamson's puzzle
compensation
boundaries of the firm
fairness
small numbers
idiosyncratic exchange
entitlements
obligations
routines
framing
JEL: 
B52
D02
L2
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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