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Classification of Networks

In: Internal Rating Systems and the Bank-Firm Relationship

Author

Listed:
  • Bernardino Quattrociocchi

    (La Sapienza University)

Abstract

When the connections between firms take on a growing importance and intensity, a new economic reality known as a “network” is formed. With the formation of the network attention shifts to cooperative relationships when considering the nature of relational interconnections. The enterprise network is an organizational system that coordinates businesses, turning them into a single system of economic action. In this sense it is a form of organization that is distinct from the market, which coordinates nodes without connecting them, and also distinct from the hierarchy, which connects all nodes to one central system through systems of rules that apply to everyone. The network, however, consents to govern macro-processes, avoiding a stiffening of the structure. For this reason, it is important to consider the network as the third principle of organization compared to the hierarchy and the market, for some authors, to be able to understand in depth the nature of the new organizational forms and trends (Rullani, 1990).

Suggested Citation

  • Bernardino Quattrociocchi, 2016. "Classification of Networks," Palgrave Macmillan Studies in Banking and Financial Institutions, in: Internal Rating Systems and the Bank-Firm Relationship, chapter 2, pages 25-31, Palgrave Macmillan.
    • Handle: RePEc:pal:pmschp:978-1-137-49725-3_3
    DOI: 10.1057/9781137497253_3
    as

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