Explaining Firm Emergence: Specialization, Transaction Costs, and the Integration Process

Per Bylund

Managerial and Decision Economics, 2015, vol. 36, issue 4, 221-238

Abstract: This article explains firm emergence and the role of firms in the market structure using the productive power of specialization. Based on productivity efficiencies through technological specialization, a model for firm emergence is drafted alongside Coasean transaction cost theory. I find that transaction costs cannot explain firm emergence, but the entrepreneurial specialization perspective here adopted provides a promising approach to understanding the firm's function to the entrepreneur and its internal organization and capabilities. It suggests a foundational framework for studying the creation of capabilities and the interplay between markets, firms, and entrepreneurs. Copyright © 2014 John Wiley & Sons, Ltd.

Date: 2015
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Persistent link: https://EconPapers.repec.org/RePEc:wly:mgtdec:v:36:y:2015:i:4:p:221-238

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