MSc Management, Organisations & Governance MG 426: Organisations in the Economy and Society Academic year: 2010-11

ac!"ty Teacher Responsible: Dr. Sandy Pepper (email: a.a.pepper@lse.ac.uk). Lectures will be i!en by Pro". Da!id #arsden$ Dr. %onathan Liebenau and Dr. Sandy Pepper. &lasses will be tau ht by %onathan Liebenau$ Sandy Pepper and #arko &oh. #o!rse aims This core course will introduce students to the economic and social conte't in which mana ers and their or anisations operate. #ana ers ha!e a special role within or anisations by !irtue o" their ability to structure the way the or anisation is desi ned and work is or anised$ to position their or anisations in a chan in economic and social landscape$ and to de!elop or anisational capabilities to pro"it "rom new opportunities. (ur teachin encoura es students to address )uestions such as: *hy do "irms e'ist and what are the boundaries o" the "irm+ *hy does e'chan e sometimes occur throu h markets and sometimes throu h "irms+ Do markets emer e or are they created by "irms+ *hat role do networks play in markets and or anisations+ Does ownership matter+ ,s the lobal economy con!er in to one (-n lo.Sa'on) "orm o" capitalism$ or does capitalism come in many "orms+

The course draws on theory and e!idence "rom a ran e o" social sciences$ includin economics$ economic sociolo y and or anisational theory. ,t makes particular use o" historical and international e!idence. Lectures and classes are arran ed under se!en headin s: /'chan e 0irms ,ndustry structure 1etworks 2ow the "irm can shape its e'ternal en!ironment 3o!ernance 4arieties o" capitalism $ntended "earning o!tcomes 5y the end o" the course students will be able to: 6. /'plain the main economic$ sociolo ical and or anisational theories relatin to the en!ironment in which mana ers and or anisations operate7 8. Show how these theories apply in a number o" contemporary$ historical and international situations7 9. -nalyse and critically e!aluate a ran e o" or anisational )uestions drawin upon theoretical and empirical literatures "rom a !ariety o" social science and business mana ement sources7 :. &ommunicate e""ecti!ely in a number o" di""erent ways$ !erbally and in writin $ throu h "ormal essays$ presentations and in debates$ inte ratin perspecti!es "rom economics$ sociolo y and or anisation theory into their work. ,n each case the intended standard o" per"ormance is the le!el e'pected o" a ;unior e'ecuti!e or new researcher. 6< %anuary 8=68

%ect!res and c"asses Lectures take place weekly throu hout the #T and LT. There are no lectures in the ST. Lecture materials will be made a!ailable on #oodle. Lectures take place weekly on Tuesdays 6=:==.66:== hrs in 1-5 L3=6. Lectures start in week 6 on 9 (ct 8=68. &lasses be in in week 8$ and you will be told which class you are in by the end o" week 6. Therea"ter$ classes take place throu hout the #T and LT. Separate re!ision classes are i!en in the ST. &lasses depend "or their success upon your participation. The class )uestions or e'ercises are intended to uide the class discussion and to help you prepare "or this. Please discuss these in your seminar roups be"ore each class be ins so that you are well.prepared. *e e'pect li!ely participation in class presentations and class discussion. &eading 0or each lecture we identi"y a number o" key readin s which should be i!en a hi h priority. *e shall also identi"y a number o" "urther readin s which enable you to o deeper into the sub;ect. The readin s relate to each week>s lecture and classes. -ll students are e'pected to complete the key readin s be"ore the lecture and to prepare "or classes. Students should work in their assi ned roups between classes on class )uestions and any other preparatory work set in the pre!ious week. There is no te'tbook "or this course ? students are e'pected to read widely across the curriculum. 2owe!er$ particularly "or students who are !ery new to the sub;ect$ a ood eneral introductory te't is: Douma$ S. and Schreuder$ 2. (8==<). Economic Approaches to Organizations. 0ourth /dition. Pearson /ducation Limited. Those we ha!e a limited back round in economics mi ht also bene"it "rom re!iewin an under raduate microeconomics te't book such as Katz, M and Rosen, H. Microeconomics. McGraw Hill or Estrin, S. Laidler, D. and Dietrich, M. Microeconomics. ! "rentice Hall. #o!rse assessment @ou will submit two assessed essays o" up to 8$=== words each$ one at the start o" the LT and one at the start o" the ST. These count "or A=B o" your o!erall marks. There is also a two.hour unseen e'am in the summer term$ in which you ha!e to answer two )uestions. ormative essay @ou will be i!en the opportunity o" writin a practice essay on an assi ned topic to be handed in at the D(# -dministration Desk on the third "loor o" 1-5 on #onday 86 1o!ember$ and we shall aim to i!e "eedback on indi!idual essays by the end o" #T.

6< %anuary 8=68

MG426 + #o!rse overvie,

'ee( 6 #T 8 9 : A C D < E 6= 66 LT 68 69 6: 6A 6C 6D 6< 6E 8= %ect!re ,ntroduction 0irms (6) /'chan e (6) /'chan e (8) ,ndustry structure (6) ,ndustry structure (8) /'chan e (8) 0irms (8) ,ndustry structure (9) /'chan e (9) 1etworks (6) 1etworks (8) 2ow the "irm can shape its e'ternal en!ironment (6) 2ow the "irm can shape its e'ternal en!ironment (8) 3o!ernance (6) 3o!ernance (8) 3o!ernance (9) 4arieties o" capitalism (6) 4arieties o" capitalism (8) &ourse conclusion S!)*ect (r anisations in the economy and society: main )uestions addressed$ key concepts$ "oundational disciplines$ why it matters 2istorical de!elopment o" di""erent business "orms #arkets$ their or anisation and dynamics #arkets$ their or anisation and dynamics Scale and scope 5oundaries o" the "irm ? make or buy decisions and !ertical relations Property ri hts The resource.based !iew o" the "irm . capabilities$ knowled e and the "irm Fnowled e economies Labour markets: people$ ;obs and pay 1etworks and markets Technolo y and markets Traditional models 1ew models Principals and a ents$ mana erial decision makin $ beha!ioural a ency models The role o" the state$ does ownership matter+ 0amily companies and corporate o!ernance Traditional models$ liberal market economies and coordinated market economies$ institutional complementarity -lternati!e models$ &hina$ ,ndia and Russia *hat you>!e learnt and why it matters %ect!rer SP D# D# D# D# D# %L %L %L SP %L %L %L %L SP SP SP D# D# SP

6< %anuary 8=68

-etai"s o. "ect!res and c"asses %ect!re 1 #ntrod$ction to organisations in the econom% and societ% & Main '$estions addressed, (e% concepts, )o$ndational disciplines, wh% it matters *S"+ This eneral introduction to course is "ramed under the headin s o" GwhatH$ GhowH and GwhyH+ ,n terms o" the GwhatH$ the lecture be ins by askin the )uestion: G*hy do "irms e'ist+H (ther )uestions to be addressed durin the year are also introduced$ as are the "oundational disciplines which will be studied. #o!in on to the GhowH$ we discuss the "ormat o" lectures and classes$ and what is e'pected o" students in terms o" readin and class preparation work. 0inally we address why the material co!ered in this course is core to the #(3 pro ramme$ and why and understandin o" the issues co!ered is important "or a new mana ement researcher or ;unior e'ecuti!e.

Essentia" reading &oase$ R. (6E9D). GThe 1ature o" the 0irmH. Economica. :: 9<C.:=A Comment. !his is one o) two seminal articles ,% -oase, )or which he recei.ed the /o,el "rize )or economics in 0110. -oase as(s wh%, i) mar(ets are so e))icient as a means o) e2change, do )irms e2ist, and in answering this '$estion introd$ces the concept o) transaction costs, a (e% concept )or MG345. !rther reading 1one #"ass 1 There is no class this week.

%ect!re 2 irms *0+ & Historical de.elopment o) di))erent ,$siness )orms *DM+ *e discuss the rise$ and decline$ o" lar e scale business or anisations in the later 6E th and early 8=th century and the rowth o" multinational companies.

Essentia" reading Di #a io$ Paul (8==6) ,ntroduction: makin sense o" the contemporary "irm and pre"i urin its "uture. &h 6. in di #a io$ Paul ed. (8==6) !he !went%&)irst cent$r% )irm6 changing organisation in international perspecti.e. Princeton Ini!ersity Press$ Princeton &handler$ -l"red D. and Daems 2 eds. (6E<=) Managerial hierarchies6 comparati.e perspecti.es on the rise o) the modern ind$strial enterprise. 2ar!ard Ini!ersity Press$ &ambrid e$ #ass. &hapter 6. &handler: The Inited States: seedbed o" mana erial capitalism. Pp. E.:=. Supple$ 5arry (6EE6) Scale and scope: -l"red &handler and the dynamics o" industrial capitalism. Economic Histor% Re.iew$ ::: 9$ pp. A==.6:. Comment. !hese readings contrast the .iews o) an economic sociologist, Di Maggio, with two ,$siness historians, -handler *perhaps the most )amo$s ,$siness historian o) all7+ and S$pple.

6< %anuary 8=68

!rther reading Perrow$ &harles (8==8) Organizing America6 wealth, power, and the origins o) corporate capitalism . Princeton Ini!ersity Press$ Princeton. Comment. "errow pro.ides an alternati.e .iew to -handler8s on the rise o) corporate America. or a good s$mmar% o) "errow see the re.iew ,% ran( Do,,in in !heor% and Societ% 996 00:&041, 4;;3. <o$ ma% also )ind the )irst chapter a.aila,le online at6 http6==press.princeton.ed$=chapters=s:904.pd) 1icholson$ 1i el (8==<) /!olutionary Psycholo y$ (r aniJational &ulture$ and the 0amily 0irm. Academ% o) Management "erspecti.es7 88: 8$ #ay$ pD9.<:. Comment. /icholson addresses the '$estion o) how one e2plains the persistence o) )amil% owned )irms )rom an e.ol$tionar% ps%cholog% perspecti.e #"ass 2 This classes pro!ides an opportunity to make introductions$ talk about how we will work to ether o!er the year$ and set up syndicate roups. /o0ic .or c"ass disc!ssion >All ad.anced economies are progressing towards managerial capitalism, as descri,ed ,% Al)red -handler?. @ou should come to the class ready to i!e a three minute !iew on the abo!e )uestion with re"erence to your own country$ so that you may compare with other countries represented in the class. &onsider in particular the "ollowin : 0irms ? are they enerally lar e or small$ who owns them (e. .$ listed on a stock e'chan e$ "amily owned$ state owned)$ main industries /mployment ? is employment hi hly re ulated or not$ what role do trade unions play Re ulation ? how stron is the corporate le al "ramework$ are property ri ht en"orced$ is business hi hly re ulated or not+ State ? what role does the state play in industry+

%ect!re 1 E2change *0+ @ Mar(ets as organised social spaces *DM+ ,ntroduction to di""erent kinds o" market$ both in terms o" the kind o" oods traded and the social and political in"rastructure that supports them. The aim o" this topic is to enable students to rasp the !ariety o" di""erent kinds o" market that e'ist and how this can a""ect mana ements> strate ies. Essentia" reading Fahneman$ D.$ Fnetsch$ %. L.$ and Thaler$ R. (6EDE) 0airness as a constraint on pro"it.seekin : entitlements in the market. American Economic Re.iew$ DC: :$ September$ pp. D8<.D:6. Comment. Ke% reading )or class 2ayek$ 0. -. (6E:A) The Ise o" Fnowled e in Society. !he American Economic Re.iew$ 9A: : Sept.$ pp. A6E.A9=. Comment. A )ine statement o) the )ree mar(et .iew on the power o) mar(ets Swedber $ Richard (8==A) #arkets in society. &h 66 in Smelser 1eil %.$ and Swedber Richard eds. !he Hand,oo( o) Economic Sociolog%$ Princeton Ini!ersity Press$ Princeton 1%. Pp. 899.8A9. Comment. "resents the growing empirical research o) Economic Sociolog% on the nat$re o) mar(ets in recent %ears 6< %anuary 8=68

!rther reading &ook$ Philip %7 Ludwi $ %ens7 4enkatesh$ Sudhir$ and 5ra a$ -nthony -. (8==D) Inder round un markets. Economic Ao$rnal$ 66D: A8:$ 1o!. pp. 0A<<.0C6<. Comment. An interesting acco$nt o) how a mar(et )or illegal goods can operate . 2ardin$ 3arret (6EC<) The Tra edy o" the &ommons. Science$ 1ew Series$ 6C8: 9<AE$ pp. 68:9.68:<. Comment. A classic statement o) wh% pri.ate propert% and mar(ets are essential to a ,alanced econom%. Simon$ 2erbert (6EE6) (r anisations and markets$ Ao$rnal o) Economic "erspecti.es$ A:8$ Sprin $ pp. 8A.::. Comment. or those who want to read ahead, and gain an impression o) the relationship ,etween mar(ets and organisations ,% one the classic thin(ers on the s$,Bect. 0li stein$ 1. (6EEC) #arkets as politics: a political.cultural approach to market institutions. American Sociological Re.iew$ C6: :$ pp. CAC.CD9. 0ama$ /. 0. (6EE6) /""icient &apital #arkets: ,,. Ao$rnal o) inance$ :C(A): 6ADA.6C6D. Comment. Hard going, ,$t the classic statement on the nat$re o) e))icient mar(ets )or capital. #il rom$ Paul$ 1orth$ Dou lass$ and *ein ast$ 5arry (6EE=) The Role o" ,nstitutions in the Re!i!al o" Trade: The #edie!al Law #erchant $ Economics and "olitics$ 8$ #arch 6EE=$ 6.89. -!ailable "rom: http:KKwww.mil rom.netKarticlesmain.htmLhistory Comment. A .er% interesting article on competition ,etween reg$lator% regimes, and ,etween mar(ets that are reg$lated in di))erent wa%s *illiamson$ (./. (%une 6EE6) H&omparati!e economic or aniJation: The analysis o" discrete structural alternati!esH$ Administrati.e Science C$arterl%$ 9C (8)$ pp. 8CE.E<. Comment. or those who want to read ahead and get a )eel )or how Dilliamson considers the relationship ,etween organisations and mar(ets.

6< %anuary 8=68

#"ass 1 *e will be in this class by talkin about how to read a ;ournal article M *hat type o" literature is it (e. .$ theoretical$ empirical$ re!iew article$ etc)+ M *hat is bein claimed+ M ,s there backin "or the claims+ M*hat is the theoretical orientation and !alue "ramework+ M *hat is your summary e!aluation o" the te't+ /o0ics .or c"ass disc!ssion: 6. *hy do ordinary people appear to hold )uite di""erent !iews about the le itimacy o" raisin prices in response to market demand in labour markets as compared with auction markets+ 8. *hat do economists and economic sociolo ists mean by GinstitutionsH+ &onsider the de"initions o""ered by a number o" authors. 9. 2ow important are norms o" "air play in markets+ -re such norms likely to dama e incenti!es and pre!ent markets "rom workin properly+ :. Do institutions o""er an alternati!e to state re ulation o" pricin beha!iour+ /ach topic is to be prepared in ad!ance and presented by a di""erent syndicate roup.

6< %anuary 8=68

%ect!re 4 E2change *4+ @ Mar(ets and organisations *contin$ed+ *DM+ *e e'amine the )uestion o" price and )uality in markets$ and how the issue o" )uality can be dealt with in di""erent ways in di""erent kinds o" markets$ whether by the public authorities or by pri!ate economic actors. ,n class$ we consider the sale o" second hand oods (-kerlo") and o" health care (-rrow)$ and apply the lessons o" these classic studies to current products.

Essentia" reading -rrow$ Fenneth %. (6EC9) Incertainty and the *el"are /conomics o" #edical &are. American Economic Re.iew$ A9: A$ pp. E:6.ED9. -kerlo"$ 3eor e -. (6ED=) The #arket "or NLemonsN: Ouality Incertainty and the #arket #echanism$ C$arterl% Ao$rnal o) Economics$ <:: 9$ -u .$ pp. :<<.A==. Podolny$ %.#. (8==6) G1etworks as the pipes and prisms o" the marketH$ American Ao$rnal o) Sociolog%$ 6=D (6)$ pp. 99.C=. Comment. !he articles ,% Arrow and A(erlo), ,oth economists, ill$strate two di))erent wa%s in which mar(ets ma% not operate e))icientl%. "odoln%, an economic sociologist, loo(s at how networ(s con.e% in)ormation within mar(ets. or a '$ic( s$mmar% o) what a p$,lic good is see6 http6==en.wi(ipedia.org=wi(i="$,licEgood !rther reading &oase$ Ronald$ 2. (6ED:) The Li hthouse in /conomics. !he Ao$rnal o) Law and Economics$ 6D: 8$ (ct.$ pp. 9AD.DC. Sti ler$ 3eor e %. (6EC6) The /conomics o" ,n"ormation. !he Ao$rnal o) "olitical Econom%$ CE: 9$ %une pp. 869.88A. Comment. !he -oase arg$ment t$rns Sam$elson8s arg$ment that a lightho$se is archet%pal e2ample o) a p$,lic good on its head, demonstrating how ingenio$s mar(et sol$tions can o)ten ,e. #"ass 4 This week>s class will be based around an G('"ord InionH style debate rather than class )uestions. The topic can be analysed usin tools and techni)ues learnt durin the "irst "ew weeks o" term. /o0ic .or de)ate: >!he ed$cation c$rrentl% pro.ided ,% not&)or&pro)it $ni.ersities )or ,achelors8 and masters8 degrees co$ld ,e e'$all% well pro.ided ,% )or&pro)it companies.? #omment2 #any !ocational courses are pro!ided by "or.pro"it or anisations$ so why not uni!ersity de rees+ *hat can we learn "rom the cases o" health care and second.hand cars about how to use markets to supply education+ ,s there a parallel between the use o" uni!ersity rankin s and Pprisms> in Podolny>s sense+ 3re0aration2 ,n preparation "or the debate$ the class will be di!ided into "our roups$ one proposer and one seconder "or each side in the debate. /ach roup would work to ether to prepare the presentation "or the proposer$ and "or the seconder$ the aim would be to anticipate the ar uments o" the other side and to rebut them.

6< %anuary 8=68

<

%ect!re 4 #nd$str% str$ct$re *0+ @ Scale and scope *DM+ /conomies o" scale and scope$ and an analysis o" or anisational structures desi ned to harness these. The topic will also discuss diseconomies o" scale$ and the trade.o""s in!ol!ed. /conomies o" scale are "re)uently thou ht to underlie a lack o" competition. &ompetition may also be restricted by the use o" cartels. There is considerable debate as to how "ar both "actors lead to durable concentrations o" market power. -s market power is a source o" economic rents$ one can ima ine that many "irms> business strate ies would be oriented towards increasin market power and hence economic rents. 2ow stable are such strate ies$ and how commonly are they undermined by price wars+ Essentia" reading 5usse$ #e han. (8==8) 0irm "inancial condition and airline price wars. R-1D %ournal o" /conomics7 Summer$ 99: 8$ pp. 8E<.96<. &handler$ -l"red D. %r (6EE=) Scale and Scope6 the d%namics o) ind$strial capitalism . 2ar!ard Ini!ersity Press$ &h. 8. Scale$ scope and or anisational capabilities. Pp. 6:.:C. &abral L. (8===) ,ntroduction to industrial or anisation. #,T Press$ &ambrid e$ #ass.. (esp. &h :. 3ames and strate y QS&-1R S &h A. #onopoly and re ulation). 1ote: introduces prisoner>s dilemma ame$ and pricin under monopoly conditions. Le!enstein$ #ar aret &.$ and Suslow$ 4alerie @. (8==C) *hat Determines &artel Success+ Ao$rnal o) Economic Literat$re 4ol. TL,4 (#arch 8==C)$ pp. :9?EA. Comment. !he lect$re will present the ,asic ideas o) scale and scope. -handler gi.es a good historical acco$nt o) the rise o) economies o) scope. !he F$sse, -a,ral and Le.enstein readings gi.e insight into price wars. !rther reading &oase$ R.2. (-pril 8===) GThe ac)uisition o" 0isher 5ody by 3eneral #otorsH$ Ao$rnal o) Law and Economics$ :9 (6)$ pp. 6A.96. Liebenau$ %. and 5ourdeau de 0ontenay$ -. (8==C) G#odellin scale and scope in the telecommunications industry: problems in the analysis o" competition and inno!ationH -omm$nications G Strategies C6$ Pp. 69E. 6AC. Sutton$ %ohn (6EE6) S$n( costs and mar(et str$ct$re6 price competition, ad.ertising and the e.ol$tion o) concentration. #,T Press$ &ambrid e #ass and London. &h < The e!olution o" ad!ertisin .intensi!e industries. QT( 5/ S&-11/DR /dward %ay /pstein.6E<8. G2a!e you /!er Tried to Sell a Diamond+H !he Atlantic Monthl%. 0ebruary. http:KKwww.the -tlantic.comKdocK6E<8=8Kdiamond Comment. !he readings o) Epstein and S$tton gi.e insight into how mar(et power can ,e ,$ilt ,% means o) ad.ertising. Lie,ena$ e2amines scale and scope in networ(ed ind$stries which some arg$e are .er% di))erent )rom traditional man$)act$ring, economies o) networ(s ,eing o) a special nat$re. -oase challenges a widespread .iew o) ,$siness integration.

6< %anuary 8=68

#"ass 4 *e will be in this class by lookin at what constitutes a ood essay$ includin M what thin s should be included in the introduction$ the middle section$ and the conclusion M warrantin your claims M takin a critical perspecti!e rather than merely bein descripti!e /o0ics .or c"ass disc!ssion 6. economies+ 8. readin s) 9. readin s)+ :. *hy are economists "ascinated by the prisoner8s dilemma+ 3i!e e'amples o" business situations where the prisoner>s dilemma applies. *hat are sunk costs and what is their si ni"icance "or business (Sutton and /pstein *hy do "irms en a e in price wars$ and what restrains them+ (5usse$ Le!enstein S Suslow *hat do we mean by economies o" scale and scope+ *hy mi ht there be limits to scale

/ach topic is to be prepared in ad!ance and presented by a di""erent syndicate roup.

%ect!re 6 #nd$str% str$ct$re *4+ & Fo$ndaries o) the )irm @ ma(e or ,$% decisions and .ertical relations *DM+ G#ake or buyUH decisions and !ertical "irm relations. Such decisions are based partly on transaction and coordination costs$ on internal economies o" knowled e and in"ormation sharin $ and on elements o" risk. spreadin and risk.sharin . &ompetition and ;oint !entures: production and contractual aspects. This topic would also discuss some o" the Gboundaries o" the "irmH debate$ e. .$ %apan ! IS models. Essentia" reading *illiamson$ (li!er (6E<A) Economic instit$tions o) capitalism$ &h. :: 4ertical inte ration: theory and policy$ pp. <A.6=8$ and &h. C. The limits o" "irms: incenti!e and bureaucratic "eatures$ pp. 696.6C8. 3ibbons$ Robert (8==6) 0irms (and other relationships). &h. D in di #a io$ Paul ed. (8==6) !he !went%&)irst cent$r% )irm6 changing organisation in international perspecti.e . Princeton Ini!ersity Press$ Princeton. 2elper$ Susan$ and Sako$ #ari (6EEA) Supplier relations in %apan and the Inited States: are they con!er in + Sloan #ana ement Re!iew$ 9C: 9$ pp DD.<:. Comment. Dilliamson is one o) the leaders o) the >/ew #nstit$tional Economics? mo.ement, which ta(es as its starting point -oase8s wor( on the nat$re o) the )irm. He anal%ses the ma(e or ,$% pro,lem in terms o) transaction costs, opport$nism, and asset speci)icit%. Helper and Sa(o ta(e a di))erent stance, loo(ing at the nat$re o) relational contracting, especiall% in Aapan. !rther reading Sako$ #ari (8==:) Supplier de!elopment at 2onda$ 1issan and Toyota: comparati!e case studies o" or aniJational capability enhancement. #nd$strial G -orporate -hange$ 69: 8$ pp. 8<6.9=<. 2elper$ Susan and Sako$ #ari (8=6=)$ G#ana ement inno!ation in supply chain: appreciatin &handler in the twenty."irst centuryH7 #nd$strial and -orporate -hange$ 6E: 8$ pp. 9EE?:8E Comment. !he second Helper and Sa(o article re&e.al$ates the wor( o) -handler *whose theoretical )ramewor( owes m$ch to -oase and transaction costs economics+ in the light o) their wor( on relational contracting

6< %anuary 8=68

6=

#"ass 6 /o0ics .or c"ass disc!ssion 6. Discuss the concepts o" economies o" scale and scope as applied to: (i) a manu"acturin industry7 (ii) a ser!ice acti!ity. 8. 2ow can "irms use !ertical inte ration to ain better control o" supplier relationships+ *hat are the bene"its and the downsides+ (see especially 3ibbons and *illiamson readin s) 9. *hy does the IS di""er so much "rom %apan+ (2elper and Sako and Sako readin s). :. *hy should it bene"it %apanese "irms to share knowled e with their suppliers whereas 3ibbons> e'ample su ests this would be suicidal+ /ach topic is to be prepared in ad!ance and presented by a di""erent syndicate roup.

%ect!re 5 E2change *4+ @ "ropert% rights *AL+ #arket e'chan e depends upon an in"rastructure o" property ri hts$ (pri!ate$ commons$ etc) and an ability to en"orce contracts. Special topics "or current business mi ht be intellectual property$ interdependent ownership within networks (e as in telecoms). Essentia" reading Lan lois$ Richard 1. (8==C) The Secret li"e o" mundane transaction costs. Organization St$dies 8D(E):69<E. 6:6= Liebenau$ %. and 5ourdeau de 0ontenay$ -. (8==C) GThe economics o" the commonsH (mimeo$ "orthcomin ) 5enkler$ @ochai (8==C) The *ealth o" 1etworks: 2ow Social Production Trans"orms #arkets and 0reedom. @ale Ini!ersity Press$ 1ew 2a!en$ &onn. &hapter 8$ GSome basic economics o" in"ormation production and inno!ationH Pp. 8E.A< http:KKwww.benkler.or K5enklerV*ealthV("V1etworks.pd" Qthe whole bookR http:KKwww.benkler.or K5enklerV*ealthV("V1etworksV&hapterV8.pd" Qassi ned chpR !rther reading To "ollow #"ass 5 /o0ics .or c"ass disc!ssion 6. Do non.tan ible and networked oods ha!e distinct property ri hts+ &onsider 5enkler (8==C) and Liebenau S de 0ontenay (8==C). 8. *hat kinds o" transactions occur with non.corporeal oods and ser!ices+ &onsider Lan lois (8==C). 9. Do markets "or knowled e di""er "rom markets "or oods+ :. Traditional property ri hts cannot be reconciled with e""ecti!e internet commerceH. &omment

6< %anuary 8=68

66

%ect!re 6 irms *4+ &!he reso$rce&,ased .iew o) the )irm & capa,ilities, (nowledge and the )irm *AL+ The nature o" the "irm as a Gbundle o" human resourcesH (Penrose). 2ow this enriches and de!elops &handlerUs ideas o" distincti!e capabilities o" or anisations. Fnowled e economies ha!e a contractual aspect throu h ownership and the sharin o" income streams associated with it$ but it has also an epistemic side$ o" how or anisations can inte rate knowled e "rom di""erent sources (e. . Gmode 6UH academic discipline.based knowled e and Gmode 8H knowled e as practice). Essentia" reading &onner F. R$ and Prahalad &. F. (6EEC) - resource.based theory o" the "irm: knowled e !ersus opportunism. Organization Science$ D:A$ Sept.(ct$ pp. :DD.A=6. Teece$ Da!id$ Pisano$ 3ary$ and Shuen$ -my. (6EED) Dynamic capabilities and strate ic mana ement. Strategic Management Ao$rnal$ 6<: D$ pp. A=E.99. LaJonick$ *illiam (8==9) The theory o" the market economy and the social "oundations o" the inno!ati!e enterprise. Economic and #nd$strial Democrac%$ 8:: 6$ pp. E.::. Fay$ %. (6EE9) !he )o$ndations o) corporate s$ccess. ('"ord Ini!ersity Press$ ('"ord. &hapters A.< on distincti!e capabilities (pp. C9.68:).

!rther reading 1one #"ass 6 /o0ics .or c"ass disc!ssion 6. 8. 9. A. C. *hich institutions o!ern the use o" knowled e assets amon "irms+ *hat distin uishes &handler>s notion o" capabilities "rom *illiamson>s theory o" Gasset speci"icityH+ *here does &onner and Prahalad "it in with their notion o" resource+ *hat relationships mi ht there be between scale economies and cartel arran ements+ (consider Le!instein in relation to scale issues) 2ow mi ht we di""erentiate elements o" or aniJational capabilities and GarchitecturesH as described by Fay$ Teece et al.$ and &handler+ *hat does Teece mean when he talks about Gdynamic capabilitiesH+ *hat does this perspecti!e add to the resource.based !iew o" the "irm+ (#ain re"erence Teece$ Pisano and Shuen$ 6EED).

%ect!re 7 #nd$str% str$ct$re *9+ & Knowledge economies *AL+ Fnowled e creation$ and drawin on the recent work on the "ormation and use o" knowled e networks by "irms en a ed in RSD$ and the implications o" this "or or anisational structure. *e consider some case studies o" collaborati!e !entures in RSD$ analysin why some succeeded and others "ailed.

6< %anuary 8=68

68

Essentia" reading 5rown$ %ohn Seely$ and Du uid$ Paul (8==6) Fnowled e and or aniJation: a social.practice perspecti!e. Organization Science$ 68: 8$ #arch.-pril$ pp. 6E<.869. Powell$ *alter *7 Foput$ Fenneth *7 Smith.Doerr$ Laurel. (6EEC) ,nteror aniJational collaboration and the locus o" inno!ation: 1etworks o" learnin in biotechnolo y. Administrati.e Science C$arterl%. ,thaca: :6: 67 #arch$ pp. 66C.6:C. Lam$ -lice (8==A) *ork roles and careers o" RSD scientists in network or aniJations. #nd$strial Relations$ ::: 8$ pp. 8:8.8DA. &ross$ Rob7 Laseter$ Tim7 Parker$ -ndrew$ and 4elas)ueJ$ 3uillermo (8==C) Isin Social 1etwork -nalysis to ,mpro!e &ommunities o" Practice. -ali)ornia Management Re.iew7 :E: 6$ 0all$ pp. 98.C=. !rther reading 1one #"ass 7 /o0ics .or c"ass disc!ssion 6. ,nter.or aniJational collaboration o" di""erent kinds a""ects inno!ati!e capabilities. &omment on the approaches o" Powell et al. and o" 5rown S Du uid. 8. *hat e""ect do roles ha!e on the ability o" "irms to coordinate+ &onsider Lam>s approach to RSD in network or aniJations and 5rown S Du uid>s approach to knowled e within "irms. 9. 2ow does an approach "rom communities o" practice (c.". &ross et al.) relate to routines (c.". Teece et al.)+ :. 2ow can inno!ation be stimulated in such a way as to preser!e the stability o" or anisations+ &onsider LaJonick$ as well as Powell et al. A. *hat role do uni!ersities play in commercial inno!ation+ (Lam readin etc) %ect!re 10 E2change *3+& La,o$r mar(ets6 people, pa% and Bo,s *S"+ ,n this lecture we take a closer look at the characteristics o" labour markets$ e'aminin why they di""er "rom typical commodity markets$ and considerin the role played by internal labour markets within "irms. *e think about neoclassical and new institutional economic analyses o" supply and demand in labour markets$ and why wa es are more than simply a market price. Essentia" reading #arsden$ Da!id (6EEE) A theor% o) emplo%ment s%stems6 micro&)o$ndations o) societal di.ersit% . &hapter 6. ('"ord Ini!ersity Press$ ('"ord. (-!ailable on ('"ord.Scholarship.(nline) LaJear$ /. and Rosen$ S. (6E<6) GRank.(rder Tournaments as (ptimum Labor &ontractsH. The %ournal o" Political /conomy$ 4ol. <E$ 1o. A. pp.<:6.<C: !rther reading Simon$ 2. (6EA6) G- "ormal theory o" the employment relationshipH Econometrica. 6E$ 8E9.9=A *illiamson$ (. (6E<A). !he Economic #nstit$tions o) -apital. 1@. The 0ree Press. &hapter 6=. #"ass 10 To "ollow

6< %anuary 8=68

69

%ect!re 11 /etwor(s *0+ & /etwor(s and mar(ets *AL+ The rise o" the network or anisation and the Gknowled e economyUH. The shi"t "rom the national to the lobal "ramework. ,mplications o" network e'ternalities "or economies o" scale and scope. Essentia" reading Wucker$ Lynne 3$ Darby$ #ichael R$ and -rmstron $ %e"" (6EEE) ,ntellectual &apital and the 0irm: The Technolo y o" 3eo raphically LocaliJed Fnowled e Spillo!ers. /FER Dor(ing "aper /o. w3135H Smith.Doerr$ Laurel and Powell$ *alter *. (8==A) 1etworks and economic li"e. &h. 6D in Smelser 1eil %.$ and Swedber Richard eds. !he Hand,oo( o) Economic Sociolog%$ Princeton Ini!ersity Press$ Princeton 1%. pp. 9DE.:=8. -rmstron $ #ark (6EED) &ompetition in telecoms. O2)ord Re.iew o) Economic "olic%$ !ol. 69$ pp. C:.<8. (1ote: whole issue de!oted to competition in networked industries) Porter$ #ichael /. (6EE<) &lusters and the new economics o" competition. 2ar!ard 5usiness Re!iew$ DC: C$ 1o!.Dec$ pp. DD.E=. 5urt$ Ronald S. (6EE8) Str$ct$ral holes6 the social str$ct$re o) competition . 2ar!ard Ini!ersity Press$ &ambrid e$ #ass. &h 6. The social structure o" competition !rther reading 1one #"ass 11 /o0ics .or c"ass disc!ssion 6. GThe di ital economy is di""erent "rom the Ghea!y metalH economy because the e'chan e o" !irtual oods (so"tware$ data$ entertainment$ educational content$ etc.) occurs throu h networks in ways that are distinct "rom economic models o" trade.H Discuss with re ard to eo raphical as well as G!irtualH presence. @our main re"erences should include Porter and Wucker$ and there are use"ul concepts in -rmstron . 8. *hat are (or were) the incenti!es and disincenti!es to participate in networks "or: (a) Those en a ed in technical inno!ation (e. . en ineers$ systems de!elopers$ computer scientists) (b) /arly in!estors in mobile telephone systems (i.e. "irst mo!ers in in"rastructure construction$ those applyin new business models to content deli!ery$ etc.) (c) Pro!iders o" ser!ices on transportation systems (e. . public and "rei ht transport$ special deli!ery ser!ices$ lu'ury or leisure tra!el) (d) Isers o" 0acebookKLinked,nK5ebo$ etc. (e) #obile telephone customers @our main re"erences should include &handler and -rmstron and you would bene"it "rom some ideas "rom Smith.Doerr S Powell. 9. Smith.Doerr S Powell (8==A) describe many di""erent kinds o" networks. To what e'tent is it appropriate to re ard them all as mani"estations o" the same dynamic phenomenon+ @ou mi ht take into account the basic concepts e'plained by -rmstron . :. G#etcal"e>s LawH states that the !alue o" a network is proportional to the s)uare o" the number o" users. This has been important "or understandin why networks mi ht !alued more than non.networked (e. . linear) systems but it should depend on the de"inition o" a GuserH (as opposed$ "or e'ample$ to a GsubscriberH or someone with GaccessH). Discuss this GlawH in relation to in!estment and business strate y$ and with re ard to possible di""erences amon networks and between users. Smith.Doerr S Powell$ as well as -rmstron will be use"ul. &onsider also: G#etcal"eUs Law is *ron 7 &ommunications networks increase in !alue as they add members..but by how much+ The de!il is in the detailsH 5. 6< %anuary 8=68

6:

5riscoe$ -. (dlyJko$ 5. Tilly (,/// Spectrum$ 8==C): http:KKspectrum.ieee.or Kcomputin KnetworksKmetcal"es.law.is.wron 7 and its e'tended !ersion: http:KKwww.dtc.umn.eduKXodlyJkoKdocKmetcal"e.pd"$ as well as the eneral discussion in the *ikipedia entry on G#etcal"e>s LawH.

%ect!re 12 Lect$re 04. /etwor(s and Mar(ets *!echnolog% and the creation and enlargement o) mar(ets )or new goods and ser.ices+ *AL+ 0irms o"ten are acti!e in establishin new markets$ and this can be an important part o" their business strate y. ," the di!ision o" labour is limited by the siJe o" the market$ one can en!isa e that or anisational chan es and market buildin o hand in hand.

Essentia" reading &handler$ -l"red D.$ 2a strom$ Peter$ and SYl!ell$ Zr;an$ (eds) (6EEE) !he D%namic irm6 !he Role o) !echnolog%, Strateg%, Organization, and Regions. ('"ord Ini!ersity Press$ ('"ord. (4arious chapters will be o" interest) http:KKwww.o'"ordscholarship.comKosoKpublicKcontentK economics"inanceKED<=6E<8EC=:6Ktoc.html !rther reading To "ollow #"ass 12 To "ollow

%ect!re 11 How the )irm can shape its e2ternal en.ironment *0+ @ !raditional models *AL+ The "irm can a""ect its own market structure$ and more enerally the e'ternal conte't in which it operates$ as reco niJed in the study o" imper"ect competition. This was rarely modelled as oin beyond a""ects that "irms could e'ert on prices$ )uantities$ andKor consumer surplus. The accent was still on how "irms in imper"ect markets respond to a i!en market structure. *ithin the "ield o" industrial economics this has one under the name o" the structure.conduct.per"ormance model. -lthou h the S&P "ramework noted the opportunity "or "eedback e""ects in the system$ the orderin o" these terms was always determinin .

Essentia" reading 1elson$ Richard (6EEA) NRecent /!olutionary TheoriJin about /conomic &han eN %ournal o" /conomic Literature. 4ol 99$ p. :<.D=. #c*illiams$ -ba ail$ and Smart$ Dennis L. (6EE9) /""iciency !. Structure.&onduct.Per"ormance: ,mplications "or Strate y Research and Practice. %ournal o" #ana ement7 6E: 6$ Sprin $ pp. C9.DE.

6< %anuary 8=68

6A

!rther reading To "ollow #"ass 11 To "ollow

%ect!re 14 How the )irm can shape its e2ternal en.ironment *4+ @ /ew models *AL+ 1ew models. The study o" the strate ic in"luence o" "irms on their e'ternal en!ironment includes all aspects o" society "rom public opinion to the desi n o" communities and our educational systems. That a "irmUs conduct can inad!ertently alter the e'ternal en!ironment has ne!ertheless been reco niJed and known as the e'ternality problem in neo.classical economics. 5ut more recently$ models o" "irm conductKbeha!iour ha!e shown how the e'ternal en!ironment is not an e'o enous "orce immune "rom "irm polices or strate ies. These models include such topics as cascade theory (%ack 2irschlei"er) the creation o" dynamic barriers to entry (%ohn Sutton)$ and the use o" in"ormation technolo ies (2al 4arian).

Essentia" reading Samuel 5owles. 6EE<. G/ndo enous Pre"erences: The &ultural &onse)uences o" #arkets and (ther /conomic ,nstitutionsH Ao$rnal o) Economic Literat$re. #arch. pp.DA.666. /dward %ay /pstein.6E<8. G2a!e you /!er Tried to Sell a Diamond+H The -tlantic #onthly. 0ebruary. http:KKwww.the -tlantic.comKdocK6E<8=8Kdiamond. Sutton$ %ohn (6EE6) S$n( costs and mar(et str$ct$re6 price competition, ad.ertising and the e.ol$tion o) concentration. #,T Press$ &ambrid e #ass and London. &h < The e!olution o" ad!ertisin .intensi!e industries. 5ikhchandani$ Sushil7 2irshlei"er$ Da!id and *elch$ ,!o (6EE8) - Theory o" 0ads$ 0ashion$ &ustom$ and &ultural &han e as ,n"ormational &ascades. The %ournal o" Political /conomy$ 6==: A$ (ct.$ pp. EE8.6=8C. 2irshlei"er$ Da!id (6EE:) The blind leadin the blind: social in"luence$ "ads and in"ormational cascades. *orkin Paper E:=AV9=$ School o" 5usiness -dministration$ Ini!ersity o" #ichi an. http:KKdeepblue.lib.umich.eduKbitstreamK8=8D.:8K9AD8EK8K b6D9<=<8.===6.==6.pd" !rther reading To "ollow #"ass 14 The "ormat "or this class is a -E8A/E. *e will hold two debates and you will be assi ned positions to take7 one roup to de"end a proposition and the other to oppose. Those obser!in the debate will be responsible "or ;ud in the outcome and you will be called upon to state your reasons in a re!iew period. 3ro0osition 1: GThe en!ironment e'ternal to the "irm is the sin le most important determinant o" corporate strate y.H -omment6 The debate mi ht touch upon the relationship between human resources$ corporate structures and mana erial actions as the determinants o" strate y$ as opposed to "orces such as the siJe and stren th o" markets$ the role o" re ulation and o" o!ernment inter!entions o" !arious sorts. Ouestions about the role o" leadership and strate ic !ision mi ht be posed$ a ainst claims about the e""ects o" social norms$ labour markets and !arious institutions that surround "irms. 6< %anuary 8=68

6C

3ro0osition 2: G-ll rowth comes "rom inno!ation. 0irms that do not inno!ate must be content at best to sta nate.H -omment6 This proposition is intended to pose the !iew that inno!ation$ throu h new technolo y or new ways o" or anisin producti!e acti!ities$ is more important than "irm rowth throu h market capture or simple e'pansion o" scale. Ouestions mi ht be posed about the di""erence between a re ate economic rowth and the "ate o" indi!idual "irms$ and so about the eneralisability o" theories o" rowth.

%ect!re 14 Go.ernance *0+ @ "rincipals and agents, introd$ction to corporate go.ernance *S"+ This lecture be ins a series o" three lectures on lobal corporate o!ernance systems$ in which we look at the -n lo.Sa'on model o" public ownership o" companies$ state ownership o" companies and transitions "rom state ownership$ and the si ni"icant role played by "amily companies in the lobal economy. ,n the "irst lecture we e'amine a ency theory and e'plains the links between a ency theory and corporate o!ernance. *e look at corporate o!ernance mechanisms$ "ocusin initially on the -n lo.Sa'on model. Essentia" reading /isenhardt$ F. #. (6E<E). - ency Theory: -n -ssessment and Re!iew. Academ% o) Management Re.iew, 03(6)$ AD.D:. &harkham$ %. 8==A) Keeping Fetter -ompan% & -orporate Go.ernance !en <ears On. Second Edition. ('"ord Ini!eristy Press. &hapter 6. NThe /ssence o" 3o!ernanceN !rther reading %ensen$ #. and *. #ecklin (6EDC). GThe Theory o" the 0irm: #ana erial 5eha!iour$ - ency &osts and (wnership StructureH in Ao$rnal o) inancial Economies. 9: 9=A.9C=. #"ass 14 /o0ics .or c"ass disc!ssion 6. *hat insi hts does a ency theory pro!ide into the way that "irms are o!erned and mana ed+ 8. &ritically e!aluate the stren ths and weaknesses o" a ency theory as a basis "or understandin corporate o!ernance and mana erial decision.makin . 9. *hat is meant by Pcorporate o!ernance>+ Re!iew the literature and pro!ide alternati!e perspecti!es.

%ect!re 16 Go.ernance *4+ @ !he role o) the state, does ownership matterI *S"+ This week we consider the )uestion Gdoes ownership matterH by lookin at state.owned enterprises and especially at what happens when S(/s are returned to pri!ate ownership !ia pri!atisation pro rammes Essentia" reading #e inson$ *illiam L$ and 1etter %e""ry #. (8==6) 0rom State to #arket: - Sur!ey o" /mpirical Studies on Pri!atiJation7 %ournal o" /conomic Literature 4ol. 9: (%une 8==6) pp. 986?9<E *hitley R. (6EE8) Societies$ "irms and markets: the social structurin o" business systems. ,n *hitley R. ed. /uropean business systems$ Sa e$ London$ pp. A.::. !rther reading 1one 6< %anuary 8=68

6D

#"ass 16 /o0ics .or c"ass disc!ssion 6. /'plain why state owned "irms e'ist. 8. *hat are the oals o" pri!atisation pro rammes in established capitalist economies and transition economies+ (Readin : #e inson S 1etter) 9. PS(/s are ine""icient because mana ers are not moti!ated>. &onsider whether or not this statement is true and e'amine whether it e'plains the wa!e o" pri!atisation pro rammes which ha!e taken place since the 6E<=s :. *hat is a Pnational business system> (*hitley readin ). &onsider the case o" a country where there has been a ma;or pri!atisation pro rammes$ does this cause ma;or chan es in that country>s business system+

%ect!re 15 Go.ernance *9+ @ amil% companies and corporate go.ernance *S"+

,n this "inal lecture on corporate o!ernance we look at "amily companies$ which are o" particular importance in certain parts o" the world$ especially Southern /urope and South./ast -sia. Essentia" reading La Porta$ Ra"ael7 LopeJ.de.Silanes$ 0lorencio7 and Shlei"er$ -ndrei (6EEE) &orporate (wnership around the *orld$ !he Ao$rnal o) inance$ 4ol. A:$ 1o. 8. (-pr.$ 6EEE)$ pp. :D6.A6D. &ase study: GThe "lotation o" #irror 3roup 1ewspapers plc$ 6EE6 (to "ollow) and the #arch 8==6 DT, ,nspectors> Report. !rther reading #orck$ Randall$ *ol"enJon$ Daniel$ and @eun $ 5ernard (8==A) &orporate 3o!ernance$ /conomic /ntrenchment$ and 3rowth$ %ournal o" /conomic Literature$ :9$ Sept 8==A$ pp CAA.D8= #"ass 15 This class will be based around a case study: GThe "lotation o" #irror 3roup 1ewspapers plc$ 6EE6H. Students are re)uired the read the case and re!iew the back round documentation. Syndicate roups should prepare brie" answers to the )uestions listed in the case$ in preparation "or class discussion. &lass readin &ase summary: to "ollow DT, Report into the 0lotation o" #irror 3roup 1ewspapers under s:98(8) and ::8$ &ompanies -ct 6E<A$ by Ro er Thomas and Raymond Turner. 0inal report published #arch 8==6. *eblink: Jwww.pi2$nlimited.co.$(=Media=pd)=mirrorgroup.pd)SimilarK

%ect!re 16 Larieties o) capitalism *0+ @ !raditional models, instit$tional complementarit% *DM+ 2all and Soskice ar ue "irms operate in one o" two G!arieties o" capitalismUH. liberal market economies such as the IS and the IF and coordinated market economies$ such as 3ermany and %apan in which re ulation is undertaken by or anised roupin s o" the key actors. This is a use"ul way o" introducin discussion o" the political and re ulatory en!ironment in which "irms operate.

6< %anuary 8=68

6<

Essentia" reading Dore$ Ronald$ LaJonick$ *illiam$ and (USulli!an$ #ary. (6EEE) 4arieties o" capitalism in the twentieth century. ('"ord Re!iew o" /conomic Policy$ 6A: :$ *inter 6EEE$ pp. 6=8.68=. 2all$ Peter -. and Soskice$ Da!id. (8==6) Larieties o) capitalism 6 the instit$tional )o$ndations o) comparati.e ad.antage. ('"ord Ini!ersity Press$ ('"ord. &h. 6 (-!ailable !ia 5LP/S: ('"ord Scholarship online). LaJonick$ *illiam$ and (USulli!an$ #ary. (6EEC) (r aniJation$ "inance and international competition. ,ndustrial and &orporate &han e$ 4ol A$ pp. 6.:E. #urmann$ %ohann Peter$ Knowledge and -ompetiti.e Ad.antageM !he -oe.ol$tion o) irms, !echnolog% and /ational #nstit$tions. &ambrid e Ini!ersity Press$ &ambrid e. &hapter 6$ G,ntroductionH and &hapter 8$ G&ountry.le!el per"ormance di""erences and their institutional "oundationsH Pp. 6.E9 !rther reading 2ancke$ 5. (/d). (8==E) De,ating Larieties o) -apitalism @ A Reader. ('"ord Ini!ersity Press /sp. &h E. P#ana ement Practices -cross 0irms and &ountries>$ 1icholas 5loom$ &hristos 3enakos$ Ra"aella Sadun and %ohn 4an Reenen$ &entre "or /conomic Per"ormance Discussion Paper 1o.66=E$ December 8=66 http:KKcep.lse.ac.ukKpubsKdownloadKdp66=E.pd" #"ass 16 6. *hat do 2all and Sosckice mean by the term a P!ariety o" capitalism>$ and why is the "irm placed at the centre+ 8. ," you were in char e o" a ma;or IS company operatin in 3ermany or %apan$ what would be the ad!anta esK disad!anta es o" adaptin your strate y to "it the local P!ariety o" capitalism>+ 9. Same as )uestion 8$ but "or a 3erman or %apanese company operatin in the IS or in 5ritain. :. *hat$ i" any$ are the eneral lessons that can be learned "rom these e'amples+ 1ote: you may "ind it easier to concentrate in )uestions 8 and 9 on particular dimensions o" 4o& such as "inance$ skills$ industrial relations$ or inter."irm coordination. %ect!re 17 Larieties o) capitalism *4+ & Alternati.e models, -hina, #ndia and R$ssia *DM+ Essentia" reading -mable$ 5runo7 /rnst$ /kkehard7 and Palombarino$ Ste"ano (8==A) 2ow do "inancial markets a""ect industrial relations: an institutional complementarity approach. Socio./conomic Re!iew 9: 9$ #ay$ pp. 966.99=. #artin 2Ypner (8==A) *hat connects industrial relations and corporate o!ernance+ /'plainin institutional complementarity. Socio./conomic Re!iew$ 9.8 #ay$ pp 9A6.9A<. 3rano!etter$ #ark (8==A) 5usiness roups and social or aniJation$ &h. 6E in Smelser 1eil %.$ and Swedber Richard eds. !he Hand,oo( o) Economic Sociolog%$ Princeton Ini!ersity Press$ Princeton 1%. pp. :8E.:A=. !rther reading *itt$ #ichael -. (8=6=) &hina: *hat 4ariety o" &apitalism+ ,1S/-D 0aculty and Research *orkin Paper$ 8=6=K<<K/PS. http:KKssrn.comKabstract[6CEAE:= Schneider$ 5en Ross (8==E) 2ierarchical #arket /conomies and 4arieties o" &apitalism in Latin -merica. (&S,D *orkin Paper ('"ord &entre "or the Study o" ,ne)uality and Democracy$ Department o" Politics and ,nternational Relations$ Ini!ersity o" ('"ord. 0orthcomin in %ournal o" Latin -merican Studies$ -u ust 8==E. http:KKocsid.politics.o'.ac.ukKpublicationsK(&S,DVpapersK(&S,DV=CVSchneider.pd" 6< %anuary 8=68

6E

1aseemullah$ -dnan (8=6=) De!elopin 4arieties o" &apitalism: ,ndustrial 4ariation in ,ndia and Pakistan. Prepared "or the 8=6= -nnual #eetin o" the -merican Political Science -ssociation$ *ashin ton. http:KKpapers.ssrn.comKsol9Kpapers.c"m+abstractVid[6C:88:D #"ass 17 -e)ate The lesson o" the P5R,&S> is that the "ree market system is the best eneral en!ironment "or "irms to operate within$ and the P!ariety o" capitalism> does not really matter so lon as "irms are "ree to determine their own business strate ies.

%ect!re 20 -o$rse concl$sion @ Dhat %o$8.e learnt and wh% it matters *S" = AL = DM+ Essentia" reading To "ollow !rther reading To "ollow #"ass 20 To "ollow

Additiona" co!rse reading 5owles$ Samuel (8==:) Microeconomics . EconomicsM Feha.ior, #nstit$tions and E.ol$tion, Princeton Ini!ersity Press. Prolo ue$ G/conomics and the wealth o" nations and peopleH Pp. 6.8=7 /specially &hapter D$ G/'chan e: contracts$ norms and powerH Pp. 899.8CC 5urt$ Ronald S. (6EE8) Str$ct$ral holes6 the social str$ct$re o) competition . 2ar!ard Ini!ersity Press$ &ambrid e$ #ass. /specially &hapter 6. The social structure o" competition. &allon #. ed. (6EE<) The laws o" the markets. /specially &h. 6. ,ntroduction: the embeddedness o" economic markets in economics. 5lackwell$ ('"ord. &handler$ -l"red D. %r. (6EDD) !he Lisi,le hand6 the managerial re.ol$tion in American ,$siness . 2ar!ard Ini!ersity Press. /specially &h 6A. &onclusion: the mana erial re!olution in -merican business. Pp. :<:.A==. Di #a io$ P. (8==6). The Twenty."irst &entury 0irm: &han in (r anisation in ,nternational Perspecti!e. Princeton Ini!ersity Press. Dou lass &. 1orth (8==A) Nnderstanding the "rocess o) Economic -hange (Princeton /conomic 2istory o" the *estern *orld) Princeton Ini!ersity Press. /specially &hapters 6$ G-n outline o" the process o" economic chan eH$ &hapter 8 GIncertainty in an non.er odic worldH Pp. 6.88 Douma$ S. and Schreuder$ 2. (8==<). Economic Approaches to Organizations. 0ourth /dition. Pearson /ducation Limited. 0li stein$ 1eil (8==6) !he Architect$re o) Mar(ets6 an economic sociolog% o) 40 st cent$r% capitalist societies. Princeton Ini!ersity Press$ Princeton$ 1%. /specially &hapter. :. #arkets as "ields. 3ibbons$ Robert (8==6) 0irms (and other relationships). &h. D in di #a io$ Paul ed. (8==6) !he !went%&)irst cent$r% )irm6 changing organisation in international perspecti.e. Princeton Ini!ersity Press$ Princeton. 2ancke$ 5. (/d). (8==E) De,ating Larieties o) -apitalism @ A Reader. ('"ord Ini!ersity Press #arsden$ Da!id (6EEE) A theor% o) emplo%ment s%stems6 micro&)o$ndations o) societal di.ersit% . ('"ord Ini!ersity Press$ ('"ord. Perrow$ &harles (8==8) Organizing America6 wealth, power, and the origins o) corporate capitalism . Princeton Ini!ersity Press$ Princeton. /specially &hapter D$ summary and conclusions. 6< %anuary 8=68

8=