Specialization, Firms, and Markets: The Division of Labor Within and Between Law Firms
Thomas N Hubbard and
Luis Garicano ()
Working Papers from U.S. Census Bureau, Center for Economic Studies
What is the role of firms and markets in mediating the division of labor? This paper uses confidential microdata from the Census of Services to examine law firms' boundaries. We find that firms’ field scope narrows as market size increases and individuals specialize, indicating that firms’ boundaries reflect organizational trade-offs. Moreover, we find that whether the division of labor is mediated by firms differs systematically according to whether lawyers in a particular field are mainly involved in structuring transactions or in dispute resolution. Our evidence is consistent with hypotheses in which firms’ boundaries reflect variation in the value of knowledge-sharing or in the costs of monitoring, but not in risk-sharing. Our findings show how the incentive trade-offs associated with exploiting increasing returns from specialization help lead the structure of the industry to be fragmented, but highly-skewed.
Keywords: CES; economic; research; micro; data; microdata; chief; economist (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (16) Track citations by RSS feed
Downloads: (external link)
Working Paper: Specialization, Firms, and Markets: The Division of Labor Within and Between Law Firms (2003)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:cen:wpaper:03-13
Access Statistics for this paper
More papers in Working Papers from U.S. Census Bureau, Center for Economic Studies Contact information at EDIRC.
Series data maintained by Erica Coates ().