Skip to main content Accessibility help
×
Home

Embedding organizational arrangements: towards a general model

  • CLAUDE MÉNARD (a1)

Abstract

Notwithstanding its major contributions, the ‘Williamsonian’ branch of New Institutional Economics suffers from black holes that recent developments have pinpointed. Rather than taking stock, this paper capitalizes on some of these developments to look ahead. Section 2 provides a reminder of the hard core of transaction cost economics (TCE) with an emphasis on problems that TCE has allowed to identify, particularly the richness of organizational arrangements, an issue that needs further investigation. Section 3 discusses how to better understand the embedment of organizational arrangements in their institutional environment. The concept of ‘meso-institutions’ is introduced as a mean to capture mechanisms providing the needed interface. Section 4 considers another neglected dimension that requires renewed attention: the interactions of organizational arrangements with technologies that partially define their setting. This paper proposes a roadmap to explore this issue, based on an ongoing research developed around the key concept of ‘criticality’. Section 5 concludes.

Copyright

Corresponding author

References

Hide All
Acemoglu, D. and Robinson, J. A. (2012), Why Nations Fail: The Origins of Power, Prosperity and Poverty, New York, NY: Crown Business.
Alchian, A. A. (1965), ‘Some Economics of Property Rights’, Il Politico, 30 (4): 816819. Economic Forces at Work [Reprint], Indianapolis: Liberty Press, 1977.
Arrunada, B. (2007), ‘Pitfalls to Avoid when Measuring Institutions: Is ‘Doing Business’ Damaging Business?’, Journal of Comparative Economics, 35 (4): 729747.
Baker, G., Gibbons, R., and Murphy, K. J. (2008), ‘Strategic Alliances: Bridges Between ‘Islands of Conscious Power’’, Journal of the Japanese and International Economies, 22 (2): 146163.
Benham, L. (2005), ‘Licit and Illicit Responses to Regulation’, in Ménard, C. and Shirley, M. (eds.), Handbook of New Institutional Economics, Dordrecht–Berlin–New York: Springer.
Bradach, J. L. (1997), ‘Using the Plural Form in the Management of Restaurant Chains’, Administrative Science Quarterly, 42: 276303.
Bradach, J. L. and Eccles, R. (1989), ‘Price, Authority, and Trust: From Ideal Types to Plural Forms’, Annual Review of Sociology, 15: 97118.
Coase, R. H. (1937), ‘The Nature of the Firm’, Economica, 2 (1): 386405.
Coase, R. H. (1960), ‘The Problem of Social Cost’, Journal of Law and Economics, 3(October): 144.
Coase, R. H. (1998), ‘New Institutional Economics’, American Economic Review, 88 (2): 7274.
Cooter, R. D. and Schäfer, H. B. (2012), Solomon's Knot. How Law Can End the Poverty of Nations, Princeton, NJ: Princeton University Press.
Davis, L. E. and North, D. C. (1971), Institutional Change and American Economic Growth, Cambridge: Cambridge University Press.
DeMariz, C., Ménard, C., and Abeillé, B. (2014), Public Procurement Reforms in Africa: Challenges in Institutions and Governance, Oxford: Oxford University Press.
Denzau, A. T. and North, D. C. (1994), ‘Shared Mental Models: Ideologies and Institutions’, Kyklos, 47 (1): 331.
Dutton, K., Thompson, S., and Barraclough, B. (1997), The Art of Control Engineering, Harlow (UK): Addison Wesley Longman.
Englander, E. J. (1988), ‘Technology and Oliver Williamson's Transaction Cost Economics’, Journal of Economic Behavior and Organization, 10 (3): 339353.
Estache, A. and Martimort, D. (1999), ‘Politics, Transaction Costs, and the Design of Regulatory Institutions’, Policy Research Working Paper Series 2073, Washington: The World Bank.
Finger, M., Groenewegen, J. P. M., and Künneke, R. W. (2005), ‘The Quest for Coherence between Technology and Institutions in Infrastructures’, Journal of Network Industries, 6: 227259.
Finger, M. and Kunneke, R. (Eds.) (2011), International Handbook Of Network Industries. The Liberalization of Infrastructure, Cheltenham: Edward Elgar.
Furubotn, E. and Richter, R. (2005), Institutions and Economic Theory. The Contribution of the New Institutional Economics, Ann Arbor: The University of Michigan Press.
Glachant, J. M. and Lévêque, F. (eds.) (2009), Electricity Reform in Europe: Towards a Single Energy Market, Cheltenham: Edward Elgar.
Grandori, A. and Soda, G. (1995), ‘Inter-firm Networks: Antecedents, Mechanisms and Forms’, Organization Studies, 16 (2): 183214.
Greif, A. (2005), ‘Commitment, Coercion and Markets: The Nature and Dynamics of Institutions Supporting Exchange’, in Ménard, C. and Shirley, M. (eds.), Handbook of New Institutional Economics, Dordrecht–Berlin–New York: Springer.
Greif, A. (2006), Institutions and the Path to the Modern Economy: Lessons from Medieval Trade, Cambridge: Cambridge University Press.
Grossman, S. J. and Hart, O. D. (1986), ‘The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration’, Journal of Political Economy, 94 (4): 691719.
Hodgson, G. (2002), ‘The Legal Nature of the Firm and the Myth of the Firm-Market Hybrid’, International Journal of the Economics of Business, 9 (1): 3760.
Hodgson, G. (2006), ‘What Are Institutions?’, Journal of Economic Issues, 40 (1): 125.
Hodgson, G. (forthcoming), Conceptualizing Capitalism. Institutions, Evolution, Future.
Holmström, B. and Roberts, J. (1998), ‘The Boundaries of the Firm Revisited’, The Journal of Economic Perspective, 12 (4): 7394.
Joskow, P. L. (2005), ‘Vertical Integration’, in Ménard, C. and Shirley, M. (eds.), Handbook of New Institutional Economics, Dordrecht–Berlin–New York: Springer.
Klein, P. G. (2005), ‘The Make-or-Buy Decisions: Lessons from Empirical Studies’, in Ménard, C. and Shirley, M. (eds.), Handbook of New Institutional Economics, Dordrecht–Berlin–New York: Springer.
Klein, P. G. and Shelanski, H. (1995), ‘Empirical Research in Transaction Cost Economics: A Survey and Assesment’, Journal of Law, Economics and Organization, 11 (2): 335361.
Kunneke, R. (2008), ‘Institutional Reform and Technological Practice: The Case of Electricity’, Industrial and Corporate Change, 17: 233265.
Kunneke, R., Groenewegen, J., and Ménard, C. (2010), ‘Aligning Modes of Organization with Technology: Critical Transactions in the Reform of Infrastructures’, Journal of Economic Behavior and Organization, 75 (3): 494505.
Laffont, J. J. (2005), Regulation and Development, Cambridge: Cambridge University Press.
Lafontaine, F. and Slade, M. (2007), ‘Vertical Integration and Firm Boundaries: The Evidence’, Journal of Economic Literature, 45: 629685.
Lakatos, I. (1976), Proofs and Refutations, Cambridge: Cambridge University Press.
Langlois, R. N. (2010), ‘Economic Institutions and the Boundaries of Business Groups’, in Colpan, A. M., Hikino, T., and Lincoln, J. R. (eds.), Oxford Handbook of Business Groups, Oxford: Oxford University Press.
Langlois, R. N. and Robertson, P. L. (1994), ‘Institutions, Inertia, and Changing Industrial Leadership’, Industrial and Corporate Change, 3 (2): 359378.
Langlois, R. N. and Robertson, P. L. (1995), Firms, Markets, and Economic Change: A Dynamic Theory of Business Institutions, London: Routledge.
LaPorta, R., Lopez-de-Silvanes, F., Shleifer, A., and Vishny, R. W. (1998), ‘Law and Finance’, Journal of Political Economy, 106 (6): 11131155.
Levy, B. and Spiller, P. (1994), ‘The Institutional Foundations of Regulatory Commitment’, Journal of Law, Economics and Organization, 9(Fall): 201246.
Libecap, G. D. (2009), ‘Property Rights Allocation of Common Pool Resources, in Ménard, C. and Ghertman, M. (eds.), Regulation, Deregulation, Reregulation: Institutional Perspectives, Cheltenham-Northampton: Edward Elgar, chap. 2.
Libecap, G. D. (2014), ‘Addressing Global Externalities: Transaction Costs Considerations’, Journal of Economic Literature (forthcoming).
Ménard, C. (1995), ‘Markets as Institutions versus Organizations as Markets: Disentangling Some Fundamental Concepts’, Journal of Economic Behavior and Organization, 28 (3): 161182.
Ménard, C. (2006), ‘Challenges in New Institutional Economics’, in Bindsell, U., Haucap, J., and Wey, C. (eds.), Institutions in Perspective, Tubingen: Mohr-Siebeck, pp. 2133.
Ménard, C. (2010), ‘Hybrid Organizations’, in Klein, P. and Sykuta, M. (eds.), The Elgar Companion to Transaction Cost Economics, Cheltenham: Edward Elgar, chap. 18, pp. 176184.
Ménard, C. (2013a), ‘Hybrid Modes of Organization. Alliances, Joint Ventures, Networks, and Other ‘Strange’ Animals’, in Gibbons, R. and Roberts, J. (eds.), The Handbook of Organizational Economics, Princeton, NJ: Princeton University Press, chap. 26: pp. 10661108.
Ménard, C. (2013b), ‘Plural Forms of Organizations: Where do We Stand?’, Managerial and Decision Economics, 34(35): 124139.
Ménard, C. and Damergy, G. (2014), ‘Hybrids within Hybrids: A Challenging Organizational Arrangement in the Airline Industry’, Working Paper, Centre d'Economie de la Sorbonne, April.
Ménard, C. and Du Marais, B. (2006), ‘Can We Rank Legal Systems According to their Economic Efficiency?’, in Nobel, P. and Gets, M. (eds.), New Frontiers of Law and Economics, Zurich: Schulthess, pp. 727.
Ménard, C. and Shirley, M. (eds.) (2005/2008), Handbook of New Institutional Economics, Dordrecht–Berlin–New York: Springer.
Ménard, C. and Shirley, M. (2014), ‘The Future of New Institutional Economics: From Early Intuitions to a New Paradigm?’, Journal of Institutional Economics, doi:10.1017/S174413741400006X.
Ménard, C. and Yvrande, A. (2005), ‘Institutional Constraints and Organizational Change. The Case of the British Rail Reform’, Journal of Economic Behavior and Organization, 56 (4): 675699.
Monteverde, K. C. and Teece, D. J. (1982), ‘Suppliers Switching Costs and Vertical Integration in the Automobile Industry’, Bell Journal of Economics, 13 (1): 206213.
Nelson, R. R. and Winter, S. G. (1982), An Evolutionary Theory of Economic Change, Cambridge, MA: The Belknap Press of Harvard University.
North, D. C. (1981), Structure and Change in Economic History, New York, NY: Norton and Co.
North, D. C. (1990), Institutions, Institutional Change, and Economic Performance, Cambridge: Cambridge University Press.
North, D. C. (2004), Understanding the Process of Economic Change, Princeton, NJ: Princeton University Press.
North, D. C., Wallis, J., and Weingast, B. (2009), Violence and Social Orders: A Conceptual Framework for Interpreting Recorded Human History, Princeton, NJ: Princeton University Press.
Ostrom, E. (2005), ‘Doing Institutional Analysis: Digging Deeper than Markets and Hierarchies’, in Ménard, C. and Shirley, M. (eds.), Handbook of New Institutional Economics, Dordrecht–Berlin–New York: Springer.
Oxley, J. (1999), ‘Institutional Environment and the Mechanism of Governance: The Impact of Intellectual Property Protection on the Structure of Inter-firm Alliances’, Journal of Economic Behavior and Organization, 38: 283309.
Roe, M. (2000), Corporate Reorganization and Bankrupcy: Legal and Financial Materials, New York, NY: Foundation Press.
Roe, M. (2005), ‘The Institutions of Corporate Governance’, in Ménard, C. and Shirley, M. (eds.), Handbook of New Institutional Economics, Dordrecht–Berlin–New York: Springer.
Rubin, P. (1978), ‘The Theory of the Firm and the Structure of the Franchise Contract’, Journal of Law and Economics, 21 (1): 223233.
Sened, I. and Galiani, S. (Eds.) (2014), Institutions, Property Rights and Economic Growth: The Legacy of Douglass North, Cambridge: Cambridge University Press.
Shelanski, H. and Klein, P. (1995), ‘Empirical Research in Transaction Costs Economics’, Journal of Law, Economics and Organization, 11 (2): 335361.
Shirley, M. (1995), Bureaucrats in Business, Washington, DC: The World Bank.
Shirley, M. (Ed.) (2002), Thirsting for Efficiency: The Economics and Politics of Urban Water Reforms, Amsterdam: Elsevier-Pergamon.
Shirley, M. (2008), Institutions and Development, Cheltenham–Northampton: Edward Elgar.
Shleifer, A., Glaeser, E. L., La Porta, R., Lopez de Silanes, F., and Djankov, S. D. (2003), ‘The New Comparative Economics’, Journal of Comparative Economics, 31 (4): 595619.
Spiller, P. (2009), ‘An Institutional Theory of Public Contracts: Regulatory Implications’, in Ménard, C. and Ghertman, M. (eds.), Regulation, Deregulation, Reregulation. Institutional Perspectives, Cheltenham: Edward Elgar.
Spiller, P. and Tommasi, M., (2005), ‘The Institutions of Regulation: An Application to Public Utilities’, in Ménard, C. and Shirley, M. (eds.), Handbook of New Institutional Economics, Dordrecht–Berlin–New York: Springer.
Spiller, P. and Tommasi, M. (2007), The Institutional Foundations of Public Policy in Argentina: A Transactions Cost Approach, Cambridge: Cambridge University Press.
Williamson, O. E. (1971), ‘The Vertical Integration of Production: Market Failure Considerations’, American Economic Review, 61(May): 112123.
Williamson, O. E. (1975), Markets and Hierarchies: Analysis and Antitrust Implications, New York, NY: The Free Press.
Williamson, O. E. (1985), The Economic Institutions of Capitalism, New York, NY: The Free Press-Macmillan.
Williamson, O. E. (1988), ‘Technology and Transaction Costs: A Reply,’ Journal of Economic Behavior and Organization, 10 (3): 355363.
Williamson, O. E. (1991/1996), ‘Comparative Economic Organization: The Analysis of Discrete Structural Alternatives’, Administrative Science Quarterly, 36 (2): 269296, in The Mechanisms of Governance, Oxford: Oxford University Press, chap. 4.
Williamson, O. E. (2000), ‘The New Institutional Economics: Taking Stock, Looking Ahead’, Journal of Economic Literature, 37 (3): 595613.

Metrics

Full text views

Total number of HTML views: 0
Total number of PDF views: 0 *
Loading metrics...

Abstract views

Total abstract views: 0 *
Loading metrics...

* Views captured on Cambridge Core between <date>. This data will be updated every 24 hours.

Usage data cannot currently be displayed