Organizational economics (also referred to as ''economics of organization'') involves the use of
economic logic and methods to understand the existence, nature, design, and performance of
organizations, especially
managed ones.
Organizational economics is primarily concerned with the obstacles to coordination of activities inside and between organizations (firms, alliances, institutions, and market as a whole).
Organizational economics is known for its contribution to and its use of:
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Transaction cost theory: costs incurred to organize an activity, especially regarding research of information, bureaucracy, communication etc.
*
Agency theory
Agency may refer to:
Organizations
* Institution, governmental or others
** Advertising agency or marketing agency, a service business dedicated to creating, planning and handling advertising for its clients
** Employment agency, a business that s ...
: dilemmas connected to making decisions on behalf of, or that impact, another person or entity.
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Contract theory
From a legal point of view, a contract is an institutional arrangement for the way in which resources flow, which defines the various relationships between the parties to a transaction or limits the rights and obligations of the parties.
From an ...
: ways economic actors use to construct contractual arrangements, generally in the presence of
asymmetric information
In contract theory and economics, information asymmetry deals with the study of decisions in transactions where one party has more or better information than the other.
Information asymmetry creates an imbalance of power in transactions, which can ...
.
Notable theorists and contributors in the field of organizational economics:
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Kenneth Arrow
*
James March
James Gardner March (January 15, 1928 – September 27, 2018) was an American political scientist, sociologist, and economist. A professor at Stanford University in the Stanford Graduate School of Business and Stanford Graduate School of Ed ...
*
Herbert Simon
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Oliver Williamson
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Ronald Coase
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Bengt Holmström
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Oliver Hart
*
Jean Tirole
*
Joseph Stiglitz
Joseph Eugene Stiglitz (; born February 9, 1943) is an American New Keynesian economist, a public policy analyst, and a full professor at Columbia University. He is a recipient of the Nobel Memorial Prize in Economic Sciences (2001) and the Joh ...
References
Market trends
Subfields of economics
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