Topic: Business
Quotes
Keith Crocker & Scott Masten, ” Regulation and Administered Contracts Revisited: Lessons from Transaction-Cost Economics for Public Utility Regulation” (1996)
- Although, in principle, a newly integrated firm should be able to operate at least as efficiently as the two independent firms from which it was formed simply by allowing each division of the combined firm to operate independently as it had before and only intervening where net benefits were likely to be realized, the management of the combined enterprise will be unable, given the law governing internal transactions, to commit to intervening only in such a selective fashion#
Gary Miller, Managerial Dilemmas (1992)
- Hierarchies, unlike markets, institutionalize long-term mutual commitments that make it easy to trade off social acceptance and esteem against wealth.#
Posts
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Professional Culture and Market Power
Tl;dr: A great deal of market power is created and exercised, not by monopolistic companies, but by professional monocultures on the labor side, even in very competitive product markets. I. The Puzzle of Market Power Arbitrage is the main motive force in economic theory: if there’s a profit opportunity out there, we . . .