Archive for June, 2010

ISNIE Conference Papers

| Peter Klein |

I’m in lovely Stirling, Scotland, for the ISNIE Annual Meeting. (And, driven in part by my Scottish ancestry, feeling the urge to slay an Englishman.) Nobel Laureates Williamson and Ostrom are giving the keynote speeches, and many additional members of the O&M extended family are here. You can access most of the accepted papers at this link, which is almost as good as being here. Enjoy!

Next year’s conference, organized by Barry Weingast, will take place mid-June at Stanford University, so start making plans now!

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18 June 2010 at 5:47 am 4 comments

Interview with Josh Lerner

| Peter Klein |

Paul Kedrosky interviews Josh Lerner for Kauffman’s “Infectious Talk” series. Josh is one of the top researchers and teachers working at the intersection of entrepreneurship and finance, and is always worth reading (or listening to, if you prefer the podcast version).

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15 June 2010 at 12:59 pm Leave a comment

In the Pink

| Dick Langlois |

A propos Peter’s recent post about behavioral economics, I discovered this interesting video illustrating Daniel Pink’s book Drive (thanks, Steve). I don’t think there is anything about it that is particularly inconsistent with what we know about the economics of organization, but others may disagree.

I once heard Pink speak, at the 2002 Business History Conference meeting, just after his book Free Agent Nation (about the rise of self-employment) appeared. He was one third of a panel on the New Economy, the rest of which consisted of two extremely far-left twits. It was amusing to hear Pink, a former speechwriter for Al Gore, gamely hold up a sensible position, though I remember thinking what greater fun it would have been if they had invited Virginia Postrel.

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13 June 2010 at 4:02 am Leave a comment

Taking AIM

| Dick Langlois |

Aha! So that’s why nobody met me at the airport: I was supposed to be in France. Actually, I’m in the UK, traveling around as a Visiting Fellow of the Academy of Advanced International Management (AIM). I will be giving a series of talks under their aegis in Lancaster, London, and Edinburgh. I am now in Lancaster, where my host is Martin Spring, an operations management guy who is interested in modularity and contracting in the delivery of complex services like engineering. My first stop in the UK was Nottingham, where I refrained from any tax protests let alone progressive redistribution of rents. (This despite the ads for the new Ridley Scott-Russell Crowe movie prominently displayed on all the busses.) But I did speak at the Nottingham University Business School, which is home to the likes of Paul Windrum and Peter Swann.

Today I hope to see some of Lancaster, possibly including Williamson Park. Among its highly specific assets is the pictured Ashton Memorial, built by James Williamson, Jr., Lord Ashton, who made his fortune in the linoleum trade. (According to the city council website, he was able to afford this grand edifice because he paid his workers so little.)

During the trip I also plan to stop in at several conferences, including DRUID (for one day), the ISNIE conference in Stirling (where I am likely to view a flesh-and-blood Williamson), and the Schumpeter Society in Aalborg. If I can, and if the material warrants, I may try a little live (or at least half-dead) blogging from the conferences.

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12 June 2010 at 5:47 am Leave a comment

Legal and Economic Perspectives on Contracts

| Peter Klein |

Law professor Lewis Kornhauser and economist Bentley MacLeod have teamed up to provide a multidisciplinary perspective on contracts:

Contracts between Legal Persons
Lewis A. Kornhauser, W. Bentley MacLeod
NBER Working Paper No. 16049
Issued in June 2010

Contract law and the economics of contract have, for the most part, developed independently of each other. In this essay, we briefly review the notion of a contract from the perspective of lawyer, and then use this framework to organize the economics literature on contract. The review thus provides an overview of the literature for economists who are interested in exploring the economic implications of contract law. The title, Contracts between Legal Persons, limits the review to that part of contract law that is generic to any legal person. A legal person is any individual, firm or government agency with the right to enter into binding agreements. Our goal is to discuss the role of the law in enforcing these agreements under the hypothesis that the legal persons have well defined goals and objectives.

The paper is unfortunately behind the NBER firewall. Note in the comments if you find an ungated version.

Gordon Smith’s chapter in the forthcoming Elgar TCE Handbook, “Legal Precursors of Transaction Cost Economics,” is also worth a look.

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10 June 2010 at 11:46 pm 3 comments

René Stulz on Asset Bubbles

| Peter Klein |

From the HBR series “Finance: The Way Forward”:

At the same time, however, it is also critical to create conditions that make it more difficult for bubbles to emerge. This means fundamental changes in public policy. The most important change is to do everything possible to make sure that no institution is “too-big-to-fail.” We also have to do away with the Bernanke put. It is not possible for the public sector to guarantee investors against losses without creating more and more instability.

I’d add that policymakers should avoid creating bubbles in the first place, but that’s a subject for another day.

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9 June 2010 at 7:34 am 1 comment

Jane Jacobs Festschrift

| Peter Klein |

It’s called What We See and has just been published by New Village Press. Here are the publisher and Amazon links. The website,, has a blog and lots of useful information about the book, the authors, and Jacobs.

Of particular interest to O&Mers include “Rethinking ‘Jacobs Spillovers,’ or How Diverse Cities Actually Make Individuals More Creative and Economically Successful” by Pierre Desrochers and Samuli Leppälä and “The Mirage of the Efficient City” by Sandy Ikeda.

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8 June 2010 at 7:21 am Leave a comment

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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).
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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).
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