Towards a dynamic theory of transactions

Standard transaction cost economics (TCE) considers transactions from the perspective of static efficiency. Increasingly, attention is required to dynamic efficiency; to capabilities to exploit transaction relations for innovation. Since innovation is dependent on knowledge and learning, the step from the statics to the dynamics of exchange requires and understanding of the development and acquisition of knowledge, preferences, and meaning, and the role in that of interaction between transaction partners. As a step towards this, the article provides an exploration of theories of knowledge and knowledge development, the relation to language, the role of intersubjective relations, the connection with evolutionary theory and the implications for transaction cost theory.This article is a revised version ofCognition, Evolution and Dynamics in Transaction Cost Theory, research report 90-08, 1990, School of Management and Organization, presented at a conference of the Society for the Advancement of Socio Economics (SASE), Stockholm, June 1991     

Towards a theory of multinational enterprise

This paper sets forth a rationale for multinational enterprise within a transaction cost analytic framework. It is suggested that hedging is an unlikely strategy for multinationals, and that economies gained from the intermediate case of firm-specific/partially product-specific information links provides the rationale for multinational enterprise. Foreign location is necessary to exploit product-specific economies, while the multinational option internalizes and guards the non-product-specific informational content of overseas investment.     

Towards a competence theory of the region

This paper argues the case for extending the competence theoryof the firm, or more generally the competence perspective, toanalysis of the region. The relevance of the perspective followsfrom the characterisation of productive systems such as firmsand regions as ensembles of competences that emerge from, butare not reducible to social interaction. Attention is drawnto an identifiable (although unacknowledged) convergence ofideas in the recent regional literature, arguing that theseideas are best re-conceptualised in terms of regional competences.The cluster of high-technology firms in the Cambridge regionof the UK is briefly referred to in order to illustrate themain ideas of the paper.     

Towards a theory of famine relief policy

This paper examines how famine mortality is related to the distribution of food consumption. A theoretical model is proposed of how individual survival chances are affected by changes in consumption. Uncertainty in survival prospects arises from the errors made by any observer in assessing health at given current consumption. The theory is used to explore two policy issues in famine relief: the choice of budgetary rules for allocating emergency aid, and the case for price stabilization policies during famines. Applications to data for two famines in South Asia suggest that successful price stabilization would have had substantial benefits in reducing mortality.     

Towards a kernel theory of external knowledge integration for high-tech firms: Exploring a failed theory test

Designing information systems (ISs) requires a thorough understanding of the organizational knowledge processes in which these systems are used. Although much is known about internal organizational knowledge processes, the understanding of external knowledge processes is less developed. Hence, this paper reflects an attempt to operationalize and test a model of the process of external knowledge integration (EKI), consisting of an identification, acquisition, and utilization stage. We utilize high-technology based firms from a variety of high-tech categories including nanotechnology based firms since these firms have critical knowledge integration needs. The results of an international survey, with responses of 317 high-tech companies, suggest that not these three EKI-stages, but four organizational effectiveness functions (goal attainment, pattern maintenance, adaptation, and integration) account for most variation in responses. These findings seem to imply that ISs that are to support the EKI-process should be designed according to organizational effectiveness functions rather than to EKI-stages. It is proposed that each organizational effectiveness function imposes different requirements on ISs because users interact differently with IS in each function.     

Comparing technological hype cycles: Towards a theory

The notion of ‘hype’ is widely used and represents a tempting way to characterize developments in technological fields. The term appears in business as well as in academic domains. Consultancy firms offer technological hype cycle models to determine the state of development of technological fields in order to facilitate strategic investment decisions. In Science, Technology and Innovation Studies the concept of hype is considered in studies on the dynamics of expectations in innovation processes, which focuses on the performative force of expectations. What is still lacking is a theory of hype patterns that is able to explain the different shapes of hype cycles in different contexts. In this paper we take a first step towards closing this gap by studying and comparing the results of case studies on three hypes in three different empirical domains: voice over internet protocol (VoIP), gene therapy and high-temperature superconductivity. The cases differ in terms of the type of technology and the characteristics of the application environment. We conclude that hype patterns indeed vary a lot, and that the interplay of expectations at different levels affects the ability of a field to cope with hype and disappointment.     

K. William Kapp's theory of social costs and environmental policy: Towards political ecological economics

The paper analyzes the contribution of K. William Kapp, widely considered one of the founders of Ecological Economics. This paper will demonstrate how K. William Kapp developed his theory of social costs into a framework for environmental policy development, i.e. the basis for Political Ecological Economics. The latter provides the most comprehensive and non-utilitarian alternative to the main neoclassical approaches provided by Arthur Pigou and Ronald Coase. Kapp determined basic human needs to be necessary values operational for policymaking via politically derived and scientifically determined social minima (criteria) and socio-ecological indicators. This “rational humanism” was inspired by Weber's concept of substantive rationality and informed by John Dewey's pragmatic instrumentalism. The paper concludes that Kapp's contribution is important enough to cement its place in the broader school of Ecological Economics.     

Application of ecological footprint in ecological industrial systems：a study case of maize-MSG production systems

To improve the comparability of the research results of ecological industry, the ecological footprint is appliedto analyze the resource utilization and environmental pollution in various subsystems, taking maize-MSG as a case.Results show that the production process from maize to MSG is a extended process of ecological footprint, and that theecological footprint of the maize production is the biggest; the extension of ecological footprint is followed by the increaseof footprint profit, which means that the extension of production chain is an important method to improve the resourcesprofit; the systems have a big proportion of the indirect energy ecological footprint; the air and water pollution in MSGsubsystem is the most serious. At last, it can be identified that ecological footprint is a good method to measure resourceutilization and environmental pollution in various subsystems of an integrated ecological industry.     

Equity in economic relationships: Towards a positive theory

A new theory of ‘equity’ in economic relationships has begun to develop. The theory is consistent with conventional assumptions such as rationality and self-interest, but it explains phenomena that have baffled orthodox microeconomics. Productivity variation by workers in response to perceived inequity can cause wage stickiness and the persistence of inefficient wage structures. Studies by economists and social psychologists provide empirical support. Potentially, the theory is a rich one, having implications for areas such a welfare economics and the microfoundations of macroeconomics.     

Temporal and thermodynamic irreversibility in production theory

Summary. The two notions of temporal and thermodynamic irreversibility are distinguished. It is shown that the irreversibility concept of Arrow-Debreu, while establishing temporal irreversibility, does not encompass thermodynamic irreversibility. This means, the standard irreversibility concept of production theory is too weak to be in full accordance with the laws of nature.Received: 8 October 2001, Revised: 5 April 2004, JEL Classification Numbers: D20,D51,D92.For helpful comments and discussion I am grateful to Malte Faber, Andreas Lange, Martin Quaas, Armin Schmutzler and seminar participants at Berkeley, Il Ciocco, Delft, Strasbourg and Rethymno.     

Towards a disequilibrium theory of structural dynamics: Goodwin's contribution

In this paper, we reconstruct the complex itinerary towards the solution of a conceptual and mathematical problem, how to obtain growth and fluctuations in a framework where structural change is an endogenous, though intermittent, phenomenon and irregularity a natural dynamic property. This has been Goodwin's life-long research program, driven by the effort of marrying Poincaré's qualitative approach to dynamical systems with the earliest (and some of the later) attempts to formalise economic structure as a set of interacting economic units, i.e. the cells of the modern cellular dynamics. This eventually led him to computational dynamics. Our interpretation integrates the more conventional one that emphasises conceptual connections with the thoughts of Marx, Schumpeter and Keynes. Focussing upon modelling issues of an apparently pure technical nature permits a comparison of Goodwin's evolving views with those that have emerged more recently in dynamics, e.g. in the real business cycle and endogenous theories of growth. In a brief assessment towards the end of the paper, it is argued that while there is still much to be done along the path he chose, Goodwin left enough indications for us to know in which direction to go.     

Towards a consistent comparison of alternative exchange rate systems

Equilibrium allocations of alternative exchange rate regimes are compared in an intertemporal framework. When money serves only as a store of value, the same real allocations are attainable under all regimes. However, if money also serves other functions, there are equilibria under the fixed rate system that eliminate those under floating rates, and vice versa.     

Toward a theory of optimal economic systems

This paper develops a framework for theoretical analysis of optimal economic systems that synthesizes and extends many common themes found in the works of both theorists and comparativists. An economy's institutional characteristics are abstractly represented by three structures (the information, decision-making, and incentive structures) comprising the economic system. Attention is given to the fact that economic systems influence both the objective functions of, and the strategies employed by, an economy's members. Existence theorems on optimal economic systems are presented to show that the framework is not vacuous and to illustrate the problems involved in selecting an optimal economic system.     

The basic theory of industrial ecological economics

There is a great difference between the new type industrialization road in China and the road of industrialization first, then informatization and at last ecologization in western developed countries. Industrial eco-economics is one of the critical branches of eco-economics. It is a subject of objective law of structural upgrading, functional optimization and highly efficient running of industrial eco-economic system, which is combined with industrial economic system and eco-system under the condition of intellectual economy and circular economy combinations. Meanwhile, it is a relatively weak subject in the research field of eco-economics in China for the time being. Taking the practice road of new type industrialization needs the guidance of industrial eco-economics. The modern industrial eco-economics in the 21st century must be adapted to the need of new type road of industrialization in China. The paper analyzes the status quo of research and the main contents of industrial eco-economics and tries to study some key theories of the branch subject.