Scale, scope and entrepreneurshipMicroeconomics from EconWPA Abstract: To exploit the economies of scale and scope in multi-product technologies, enterprises in advanced capitalist countries grew in the last 150 years in three directions. By substituting in the place of traditional entrepreneurs professional managers, they developed organisational capabili-ties to co-ordinate effectively activities that were widely dispersed geographically and function-ally. They promoted rapid innovation by resorting to systematic Research and Development ef- forts. And, finally, they enhanced control over their markets by introducing innovations whose application required large-scale investment. In the course of these transformations the material standards in the respective countries rose to unprecedented levels. But simultaneously they led to losses in market co-ordination be-cause these transformations increased market imperfections. As a result the economies of scale and scope appear to be negatively related to the ratio of co-ordination to innovation in the econ-omy. Hence, to the extent that policy makers strive to achieve the priorities of citizens, they are advised to allow for the implications of this relationship to the best of available information. Keywords: Entrepreneurship; co-ordination; innovation; economies of scale and scope. (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpmi:0411004 Access Statistics for this paper More papers in Microeconomics from EconWPA |
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