Before the publication of Ronald Coase’s “The Nature of the Firm,” new developments in the theory of the fi rm were under way in the works of Arnold Plant at the LSE, and Dennis Robertson, Frederick Lavington, and Austin Robinson among the Cambridge Marshallians. Although in disagreement on industrial policy, these economists shared the belief that the common view that bigger firms are always more effi cient—a very popular view within the movement for industrial ‘rationalization’—was untenable from a theoretical point of view. In the works of these economists the ‘make or buy’ scheme is sometimes employed, and Coase’s idea of a cost for using the market can be found, in implicit form, in some writings of Plant that appeared before Coase’s article. But the fundamental principle that we now call “transaction costs” was hardly of any help to any of those who, at Cambridge as well as at the LSE, were insisting on the costs of coordination as a limit to the growth of the firm.

Theories of the firm in England before Coase. Stemming the tide of ‘rationalisation’ on the eve of ‘The nature of the firm’

CRISTIANO, CARLO
2015-01-01

Abstract

Before the publication of Ronald Coase’s “The Nature of the Firm,” new developments in the theory of the fi rm were under way in the works of Arnold Plant at the LSE, and Dennis Robertson, Frederick Lavington, and Austin Robinson among the Cambridge Marshallians. Although in disagreement on industrial policy, these economists shared the belief that the common view that bigger firms are always more effi cient—a very popular view within the movement for industrial ‘rationalization’—was untenable from a theoretical point of view. In the works of these economists the ‘make or buy’ scheme is sometimes employed, and Coase’s idea of a cost for using the market can be found, in implicit form, in some writings of Plant that appeared before Coase’s article. But the fundamental principle that we now call “transaction costs” was hardly of any help to any of those who, at Cambridge as well as at the LSE, were insisting on the costs of coordination as a limit to the growth of the firm.
2015
Cristiano, Carlo
File in questo prodotto:
File Dimensione Formato  
02_JHET 2015.pdf

solo utenti autorizzati

Descrizione: articolo principale
Tipologia: Versione finale editoriale
Licenza: NON PUBBLICO - Accesso privato/ristretto
Dimensione 280.84 kB
Formato Adobe PDF
280.84 kB Adobe PDF   Visualizza/Apri   Richiedi una copia
Cristiano-JHET_2015_proofs-1.pdf

accesso aperto

Tipologia: Documento in Post-print
Licenza: Creative commons
Dimensione 526.01 kB
Formato Adobe PDF
526.01 kB Adobe PDF Visualizza/Apri

I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.

Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11568/786607
Citazioni
  • ???jsp.display-item.citation.pmc??? ND
  • Scopus 2
  • ???jsp.display-item.citation.isi??? 2
social impact