“In a fundamental sense, Alchian's theory of economic organizations is different from those of Coase or Simon. He disavows an explicit model of individual choice… and… offers a system-level explanation of organizational emergence, structure, and survival that is largely independent of decision making at the micro level… Yet it is precisely this independence of a distinct model of choice that ultimately renders it compatible with the individualistic theories of both Coase and Simon….
Whether individuals optimize under uncertainty or satisfice under the more limiting conditions of bounded rationality…, Alchian's logic of natural selection, when grafted onto either approach, provides a powerful means of deriving and integrating expectations about individuals, organizations and systems. The result in either case is an approach that gains in scope and coherence, and that does so by remaining true to its underlying model of individual choice.”

—  Terry M. Moe

Source: "The new economics of organization." 1984, p. 746-747; as cited in Eggertsson (1990; 56)

Adopted from Wikiquote. Last update June 3, 2021. History

Help us to complete the source, original and additional information

Do you have more details about the quote "In a fundamental sense, Alchian's theory of economic organizations is different from those of Coase or Simon. He disavo…" by Terry M. Moe?
Terry M. Moe photo
Terry M. Moe 3
American political scientist 1949

Related quotes

“The models of management which individuals and organizations use come from a variety of sources. Sometimes the model comes from a theory. The theory may emerge from someone's thoughts about the desired characteristics of a manager, or about the characteristics of competent managers. Sometimes the model comes from a panel. A group of people, possibly in the job or at levels above the job within the organization, generates a model through discussion of what is needed to perform a management job competently.”

Richard Boyatzis (1946) American business theorist

Source: Competent manager (1982), p. 7.

Lee Smolin photo

“Many of us believed in the possibility of a principled explanation for the laws of nature. We hoped to discover a short list of principles, which could be realized in a unique theory, which would retrodict the standard model and uniquely predict the physics to be discovered beyond it. The shocking implication of the results of Strominger reported in 1986 was that it was not to be, at least within the confines of string theory. …String theory offered more, however… It offered the promise of a setting in which the different perturbative string theories are realized as expansions around solutions of a still more fundamental theory. …That more fundamental theory would have to be background independent…”

Lee Smolin (1955) American cosmologist

"A perspective on the landscape problem" arXiv (Feb 15, 2012)

Paul DiMaggio photo

“The new institutionalism in organization theory and sociology comprises a rejection of rational-actor models, and interest in institutions as independent variables, a turn toward cognitive and cultural explanations, and an interest in properties of supra-individual units of analysis that cannot be reduced to aggregations or direct consequences of individual’s attributes or motives.”

Paul DiMaggio (1951) American sociologist

Source: Introduction to The New Institutionalism and Organizational Analysis, 1991, p. 8

“Organization theory is the branch of sociology that studies organizations as distinct units in society. The organizations examined range from sole proprietorships, hospitals and community-based non-profit organizations to vast global corporations. The field’s domain includes questions of how organizations are structured, how they are linked to other organizations, and how these structures and linkages change over time. Although it has roots in administrative theories, Weber’s theory of bureaucracy, the theory of the firm in microeconomics, and Coase’s theory of firm boundaries, organization theory as a distinct domain of sociology can be traced to the late 1950s and particularly to the work of the Carnegie School. In addition to sociology, organization theory draws on theory in economics, political science and psychology, and the range of questions addressed reflects this disciplinary diversity. While early work focused on specific questions about organizations per se – for instance, why hierarchy is so common, or how businesses set prices – later work increasingly studied organizations and their environments, and ultimately organizations as building blocks of society. Organization theory can thus be seen as a family of mechanisms for analysing social outcomes.”

Gerald F. Davis (1961) American sociologist

Gerald F. Davis (2013). "Organizational theory," in: Jens Beckert & Milan Zafirovski (eds.) International Encyclopedia of Economic Sociology, p. 484-488

Francis Heylighen photo

“W. Ross Ashby is one of the founding fathers of both cybernetics and systems theory. He developed such fundamental ideas as the homeostat, the law of requisite variety, the principle of self-organization, and the principle of regulatory models.”

Francis Heylighen (1960) Belgian cyberneticist

" Ashby's book "Introduction to Cybernetics http://pespmc1.vub.ac.be/ASHBBOOK.html" at Principia Cybernetica Web, 1999-2003
Principia Cybernetica Web, 1999-2003

“The theories in this chapter, focusing on the individual level of analysis, differ somewhat from those in the next chapter, in which a more organizational level of analysis is employed. Although all of the theories are essentially cognitive and social definitionist in nature, particularly as developed in the general sociological literature, there are at least two important subgroups within the social constructionist perspective.”

Jeffrey Pfeffer (1946) American academic

Source: Organizations and organization theory, 1982, p. 209

Wang Qishan photo

“We need to respect the independent choices of model of technology management and of public policies made by countries, and their right to participating in the global technological governance system as equals.”

Wang Qishan (1948) Chinese politician

Source: "China’s Vice President Decries Technological Hegemony" in The Wall Street Journal https://www.wsj.com/articles/china-vice-president-urges-governments-to-address-their-domestic-problems-11548258999 (23 January 2019)

“…there are individual ways that we work our way through all of these systems that are corrosive and inescapable. But if there is a solution to the system itself, it’s at a collective level. It’s the level of policy and politics, it’s not at the level of individual choice.”

Jia Tolentino (1988) American writer and editor

On why her book Trick Mirror offers no solutions in “Jia Tolentino: What It’s Like Being the Most Talked About Millennial Writer” https://www.anothermag.com/design-living/11896/jia-tolentino-trick-mirror-book-interview-new-yorker-staff-writer-2019 in AnOther (2019 Sep 15)

“To summarize, the production of information and its use in transactions both incur costs and are thus subject to economizing. In the 1970s, there occurred a revival of interest among economists in the economics of transaction, and Oliver Williamson in particular, building on the earlier work of Ronald Coase and John Commons, has explored the different institutional arrangements that govern transactional choices.”

Max Boisot (1943–2011) British academic and educator

Variant: To summarize, the production of information and its use in transactions both incur costs and are thus subject to economizing. In the 1970s, there occurred a revival of interest among economists in the economics of transaction, and Oliver Williamson in particular, building on the earlier work of Ronald Coase and John Commons, has explored the different institutional arrangements that govern transactional choices.
Source: Knowledge Assets, 1998, p. 235

“Some scholars have argued strenuously against the idea that the organization is determined by its situation and have instead asserted that managers have free choice and are thereby to be held morally accountable (Bourgeois 1984; Whittington 1989). Contingency theory appears to some critics to be a managerially convenient ideology that justifies as inevitable organizational characteristics that are not really inevitable, because they are not really required for organizational effectiveness, and that injure the interests of employees *Schreyogg, 1980). Thus contingency theory is opposed by free choice.
An intermediate position within this debate is that propounded by Child (1972), which he terms “strategic choice” (though he is talking about choice regarding structure). This takes the contingency theory of organizational structure but shows that some degree of choice can nevertheless enter in at several stages in the process.”

Lex Donaldson (1947) British-Australian organizational sociologist

Source: The contingency theory of organizations, 2001, p. 127.

Related topics