A THEORY OF FIRM SCOPE

• 成果类型: Article
• 署名作者: Hart, Oliver; Holmstrom, Bengt
• 署名单位: Harvard University; Massachusetts Institute of Technology (MIT); National Bureau of Economic Research
• 刊物名称: QUARTERLY JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0033-5533
• DOI: 10.1162/qjec.2010.125.2.483
• 发表日期: 2010
• 页码: 483-513
• 关键词: internal capital-markets; diversification; COORDINATION; COMPETITION; authority; benefits

摘要

The formal literature on firm boundaries has assumed that ex post conflicts are resolved through bargaining. In reality, parties often simply exercise their decision rights. We develop a model, based on shading, in which the use of authority has a central role. We consider two firms deciding whether to adopt a common standard. Nonintegrated firms may fail to coordinate if one firm loses. An integrated firm can internalize the externality, but puts insufficient weight on employee benefits. We use our approach to understand why Cisco acquired StrataCom, a provider of new transmission technology. We also analyze delegation.