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Incomplete Contracts and the Internal Organization of Firms / Philippe Aghion, Nicholas Bloom, John Van Reenen.
- Format:
- Book
- Author/Creator:
- Aghion, Philippe.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w18842.
- NBER working paper series no. w18842
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2013.
- Summary:
- We survey the theoretical and empirical literature on decentralization within firms. We first discuss how the concept of incomplete contracts shapes our views about the organization of decision-making within firms. We then overview the empirical evidence on the determinants of decentralization and on the effects of decentralization on firm performance. A number of factors highlighted in the theory are shown to be important in accounting for delegation, such as heterogeneity and congruence of preferences as proxied by trust. Empirically, competition, human capital and IT also appear to foster decentralization. There are substantial gaps between theoretical and empirical work and we suggest avenues for future research in bridging this gap.
- Notes:
- Print version record
- February 2013.
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