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Evolution, Economic Competence, and the Market for Corporate Control

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  • Pelikan, Pavel

    (Research Institute of Industrial Economics (IFN))

Abstract

To assess the merits of the market for corporate control, this paper examines two processes which standard analysis does not study: the allocation of economic competence and the evolution of organizational structures. Economic competence is seen to be an unusual scarce resource embodied in the very ways in which individuals and organizations take economic decisions, which guides the allocation of all scarce resources, including itself. Its efficient allocation is shown to require an evolutionary trial-and-error process, where the market for corporate control plays a crucial role.

Suggested Citation

  • Pelikan, Pavel, 1989. "Evolution, Economic Competence, and the Market for Corporate Control," Working Paper Series 215, Research Institute of Industrial Economics.
    • Handle: RePEc:hhs:iuiwop:0215
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Pelikan, Pavel, 2006. "Markets vs. Government when Rationality Is Unequally Bounded: Some Consequences of Cognitive Inequalities for Theory and Policy," Ratio Working Papers 85, The Ratio Institute, revised 03 Sep 2006.
    2. Eliasson, Gunnar, 1998. "From plan to markets," Journal of Economic Behavior & Organization, Elsevier, vol. 34(1), pages 49-68, January.
    3. Pelikan, Pavel, 2004. "Interconnecting Ecolutionary, Institutional and Cognitive Economics: Six Steps towards Understanding the Six Links," Ratio Working Papers 48, The Ratio Institute.
    4. Pelikan, Pavel, 1989. "Markets as Instruments of Evolution of Structures," Working Paper Series 237, Research Institute of Industrial Economics.
    5. Pelikan, Pavel, 1997. "Allocation of Economic Competence in Teams: A Comparative Institutional Analysis," Working Paper Series 480, Research Institute of Industrial Economics.
    6. Pelikan, Pavel, 1999. "Institutions for the Selection of Entrepreneurs: Implications for Economic Growth and Financial Crises," Working Paper Series 510, Research Institute of Industrial Economics, revised 15 Feb 2000.
    7. Eliasson, Gunnar, 1990. "Business Competence, Organizational Learning and Economic Growth: Establishing the Smith-Schumpeter-Wicksell (SSW) Connection," Working Paper Series 264, Research Institute of Industrial Economics, revised Jan 1991.
    8. Villalonga, Belen, 2000. "Privatization and efficiency: differentiating ownership effects from political, organizational, and dynamic effects," Journal of Economic Behavior & Organization, Elsevier, vol. 42(1), pages 43-74, May.
    9. Eliasson, Gunnar, 1992. "The Theory of the Firm and the Theory of Economic Growth: An essay on the economics of institutions, competition and the capacity of the political system to cope with unexpected change," Working Paper Series 349, Research Institute of Industrial Economics.
    10. Kapás, Judit, 1999. "Szükséges-e többdimenziós vállalatelmélet?. Az evolúciós vállalatelmélet kritikai összefoglalása [Is a multi-dimensional theory of the firm necessary?. A critical summary of the evolutionary theory," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(9), pages 823-841.
    11. Hodgson, Geoffrey M., 1998. "Competence and contract in the theory of the firm," Journal of Economic Behavior & Organization, Elsevier, vol. 35(2), pages 179-201, April.
    12. Eliasson, Gunnar, 1993. "Endogenous Economic Growth through Selection," Working Paper Series 397, Research Institute of Industrial Economics, revised Aug 1994.
    13. Eliasson, Gunnar, 1996. "Discussion of economizing by firms: Rational economizing, but in which world?," Journal of Economic Behavior & Organization, Elsevier, vol. 29(2), pages 257-260, March.
    14. Richard H. Day, 1995. "Rationality, Entrepreneurship and Institutional Evolution," Revue Économique, Programme National Persée, vol. 46(6), pages 1473-1485.
    15. Cyert, Richard M. & Kumar, Praveen, 1996. "Economizing by firms through learning and adaptation," Journal of Economic Behavior & Organization, Elsevier, vol. 29(2), pages 211-231, March.
    16. Pelikan, Pavel, 1991. "Efficient Institutions for Ownership and Allocation of Capital," Working Paper Series 298, Research Institute of Industrial Economics, revised Mar 1992.
    17. Fikret Adaman & Pat Devine, 2002. "A Reconsideration of the Theory of Entrepreneurship: A participatory approach," Review of Political Economy, Taylor & Francis Journals, vol. 14(3), pages 329-355.

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    More about this item

    Keywords

    Corporate control; evolution of organisational structures; economic competence;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure

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