 Power inside the firm and the market: A general equilibrium approachDalia Marin and Thierry Verdier Post-Print from HAL Abstract: Recent years have witnessed an enormous amount of reorganization of the corporate sector in the United States and Europe. This article examines the role of market competition in this trend of corporate reorganization. We find that, at intermediate levels of competition, the CEO of the corporation decides to have less power inside the firm and to delegate control to lower levels of the firms' hierarchy. Workers' empowerment and the move to a flatter organizational structure emerge as an equilibrium when competition is not too tough and not too weak. The model predicts merger waves or waves of outsourcing when countries become more integrated in the global economy as the corporate sector reorganizes in response to an increase in international competition. Date: 2008-12 Published in Journal of the European Economic Association, 2008, 6 (4), pp.752-788. ⟨10.1162/JEEA.2008.6.4.752⟩ There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it. Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00754258 DOI: 10.1162/JEEA.2008.6.4.752 Access Statistics for this paper More papers in Post-Print from HAL |
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