The Firm as a Pool of Factor Complementarities

Assar Lindbeck and Dennis Snower ()

No 882, IZA Discussion Papers from Institute for the Study of Labor (IZA)

Abstract: This paper presents a new approach to the theory of the firm by identifying factor complementarities as central to the determination of the firm’s boundaries. The factor complementarities may take a variety of forms: technological and informational complementarities, as well as economies of scale and scope. We examine the tradeoff between the gains from these complementarities and transactions costs. In so doing, we must abandon the standard dichotomy between the determinants of plant size and firm size. The influence of factor complementarities on firm size is examined in partial and general equilibrium frameworks.

Keywords: firm; complementarities; plant (search for similar items in EconPapers)
JEL-codes: D23 J24 J31 J51 J53 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ent and nep-lab
Date: 2003-10
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Related works:
Working Paper: The Firm as a Pool of Factor Complementarities (2003)
Working Paper: The Firm as a Pool of Factor Complementarities (2003)
Working Paper: The Firm as a Pool of Factor Complementarities (2003)
Working Paper: The Firm as a Pool of Factor Complementarities (2004)
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