Archive for October, 2007

Funny Things Scientific Researchers Do

| Peter Klein |

31 October 2007 at 11:14 pm Leave a comment

Halloween Movies for Middle Managers

| Peter Klein |

The Saw movies, writes Grady Hendrix in Slate, are perfect for middle managers. Typical slasher flicks are “id-tickling celebrations of the chaos that ensues when mindlessly violent monsters are unleashed in controlled environments like summer camps, schools, hospitals, and space stations. ” By contrast, Jigsaw — the protagonist-villian of the Saw films — is

a pedant and a bore, a Type A overachiever who is constantly creating “tests” for the other characters and then grading the results. Chaos is his enemy; order and personal productivity are his friends. He’s a management drone leading the cast in a team-building exercise. . . . In Saw III he uses liquefied pigs, death by car wash, and a tricked-out version of the rack to awaken a grieving father to the magic of forgiveness. It’s the liberating figure of the motion picture monster reduced to the status of a self-help guru. And he won’t shut up. “Despite all of the advantages and privileges that you were given at birth, you have returned to prison again and again,” he scolds one of his victims. “Up until now, you have spent your life among the dead, piecing together their final moments. You’re good at this because you are also dead. Dead on the inside,” he preaches at another. It’s like an endless lecture from your mom.

The Saw movies don’t just celebrate traps; they are traps: Fans are lured in with the promise of gore, but they find themselves stuck in their seats, subjected to Jigsaw’s endless stream of numbing pseudo-profundities.

An “endless stream of numbing pseudo-profundities”? Hmmm, sounds like some of the academic journals I read.

30 October 2007 at 10:41 pm Leave a comment

Are Transaction Costs a Distraction?

| Nicolai Foss |

Yes, says Harold Demsetz in a paper, “Ownership and the Externality Problem,” which was published in 2003, but which I only read recently (there does not seem to exist an online version; the paper is chpt. 11 in this book).  

Consider the steel mill and the laundry of the Traditional Externality Tale. The two firms could merge, in which case externalities per definition would be absent. This, of course, only substitutes (additional) management costs (the costs of reduced specialization) for the transaction costs of market exchange. The former may exceed the latter in which case specialization is preferable, but then externalities emerge.  (more…)

29 October 2007 at 11:07 pm 1 comment

Maybe Taylorism Will Come Back

| Peter Klein |

The human race will one day split into two separate species, an attractive, intelligent ruling elite and an underclass of dim-witted, ugly goblin-like creatures, according to a top scientist.

It doesn’t happen for 100,000 years, so today’s management consultants are safe. Of course, my headline refers to the popular conception of “Taylorism,” not actual Taylorism. (HT: Uncommon Descent)

29 October 2007 at 11:14 am 2 comments

O&M on Facebook

| Peter Klein |

I have an account on Facebook, but I don’t really know what to do with it. (All the cool kids use it, so I figured what the heck.) Anyway, for those of you serious Facebook users, we’ve created a Facebook group for O&M. Besides the usual social-networking features the page has Discussion Board capabilities so you can raise and discuss issues of interest without waiting for an appropriate post to appear here on the blog. Enjoy!

27 October 2007 at 11:30 pm 1 comment

. . . And If You Can’t Teach, Teach Gym

| Peter Klein |

You know the old adage: If you can, do; if you can’t, teach. Is it true for business?

A paper in the August 2007 Academy of Management Perspectives, “Do Business School Professors Make Good Executive Managers?” by Bin Jiang and Patrick Murphy (full text; abstract; press release), identifies 217 firms with former business-school professors in management positions and finds that these firms have higher revenues-per-employee than a control group matched by industry, location, and firm size. Faculty making early exits from their academic careers appear to be the most valuable, while neither academic area nor business-school ranking seem to matter. Conclusion:

Executive managers learn from past experiences when they draw the right lessons from those experiences. But experience alone is not enough. Given the rigorous training professors receive in order to design research that objectively parses error and data, one final supposition is that they may be particularly competent at delineating patterns in complex management and organizational experiences. They may also be especially capable of continually developing innovative questions that lead to information useful for executive decision-making amidst uncertainty.

I enjoyed reading the paper. Certainly I like to think that I’d command a high salary if I chose to give up my cushy professor lifestyle for the real world. However, I don’t find the empirical analysis convincing. Here’s why: (more…)

27 October 2007 at 10:14 am 5 comments

Insert Your Own Punch Line Here

| Peter Klein |

Brian McCann describes recent experimental work on the ultimatum game:

Unlike humans, who have a tendency to make generous offers when they are the first player and to reject non-generous offers when they are the second players, chimpanzees exhibit the type of rational, profit-maximizing behavior economists would expect.  

26 October 2007 at 11:57 pm Leave a comment

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Our Recent Books

Nicolai J. Foss and Peter G. Klein, Organizing Entrepreneurial Judgment: A New Approach to the Firm (Cambridge University Press, 2012).
Peter G. Klein and Micheal E. Sykuta, eds., The Elgar Companion to Transaction Cost Economics (Edward Elgar, 2010).
Peter G. Klein, The Capitalist and the Entrepreneur: Essays on Organizations and Markets (Mises Institute, 2010).
Richard N. Langlois, The Dynamics of Industrial Capitalism: Schumpeter, Chandler, and the New Economy (Routledge, 2007).
Nicolai J. Foss, Strategy, Economic Organization, and the Knowledge Economy: The Coordination of Firms and Resources (Oxford University Press, 2005).
Raghu Garud, Arun Kumaraswamy, and Richard N. Langlois, eds., Managing in the Modular Age: Architectures, Networks and Organizations (Blackwell, 2003).
Nicolai J. Foss and Peter G. Klein, eds., Entrepreneurship and the Firm: Austrian Perspectives on Economic Organization (Elgar, 2002).
Nicolai J. Foss and Volker Mahnke, eds., Competence, Governance, and Entrepreneurship: Advances in Economic Strategy Research (Oxford, 2000).
Nicolai J. Foss and Paul L. Robertson, eds., Resources, Technology, and Strategy: Explorations in the Resource-based Perspective (Routledge, 2000).

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