The theory of the firm consists of a number of economic theories that explain and predict the nature of a firm such as a business, company or corporation, including its origin, continued existence, behavior, structure and relationship to the market. Firms are treated as key drivers in economics, providing goods and services in exchange for payment, and major theories such as transaction cost theory, managerial economics, the behavioral theory of the firm, the resource based view and the dynamic capabilities framework each provide a conceptual lens for analyzing how a firm's organizational structure, incentives and information affect both its internal operation and its performance in the wider economy. This description is adapted from Wikipedia contributors under CC BY-SA 4.0; changes were made. https://creativecommons.org/licenses/by-sa/4.0/
Facts
Core ClaimA body of economic theories that explain and predict the nature, existence and behavior of firms, including why they exist and how they are structured. 1 Classification
Topic (Functional Area) Connections
Associated With
Williamson shared the 2009 Nobel Memorial Prize in Economic Sciences in part for his work extending the theory of the firm through transaction cost economics.
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1. Wikipedia, Theory of the firm
Introduction
The theory of the firm consists of a number of economic theories that explain and predict the nature of a firm
History section, Coase attribution
Ronald Coase set out his transaction cost theory of the firm in 1937, making it one of the first (neo-classical) attempts to define the firm theoretically
Introduction, functional area topic classification
The theory of the firm consists of a number of economic theories that explain and predict the nature of a firm: e.g.
- Associated With: Oliver E. Williamson
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