“The Importance of Organizational Structure for the Adoption of Innovations” (with Catherine Dibble and Keyvan Amir-Atefi) Management Science 46, 2000

Abstract

Organizational structure affects both the overall behavior of firms and the situations of individuals and subunits within firms. The effect of exogenous changes in the environ­ment (market prices, costs, or regulations) on organizations can be partitioned into the immediate direct effect of the change and the full effect after organizational structure has  had time to adjust. This paper develops a computational model of the diffusion of a profitable innovation through a firm, and uses numerical simulations to calculate the  relative importance of the direct and structural adjustment components of changes in  profitability. One finding is that a failure to recognize the importance of organizational  structure on the performance of firms will lead to serious bias in estimation of the costs or benefits of a change in external circumstances. The type of network model developed also has implications for the individuals and divisions that make up the firm. We examine some of the structural characteristics of well-adapted organizations, and show that asymmetries and economic inequalities emerge even when the individual agents’ personal characteristics are identical.

 

 

“Information Processing and Organizational Structure” (with William E. Watkins), Journal of Economic Behavior and Organization 36 (1998)

Abstract

Standard economic theories of the firm (and other organizations) stress profit maximization as the foundation for derivation of predictable behavior. Yet statistical and case-study evidence continues to accumulate that real firms do not act as required by the neoclassical framework.  Instead of being represented by ever more elaborate maximization models, the firm can be modeled simply as a network of information-processing agents. The actions of the firm are then a function only of the network structure and the information-processing capabilities of the agents. This approach can be used to explain a number of features of organizational behavior, including the process of technological diffusion. It also suggests that derivation of the optimal organizational structure may be computationally complex, with a number of implications for economic  theory and policy development.

“Delivered Pricing and Multiple Basing Point Equilibria: A Re-evaluation” Quarterly Journal of Economics 99, 1984

Abstract

This paper examines delivered pricing with systematic freight absorption in the light of the modern theory of spatial competition. Delivered pricing, multiple basing point equilibria are compared with f.o.b. mill pricing equilibria under a variety of assumptions about market structure and  firms’  conjectural  variations.  It is shown that there is no clear reason for preferring f.o.b. pricing or delivered pricing in the abstract. Delivered pricing is likely to be preferable from the consumer’s standpoint either if the conjectural variations of the  firms are  high,  or if conjectural  variations are consistent, and there are few firms in the industry.

“Uncle Tom’s Cabin: A Reappraisal” The Centennial Review 34, 1990.

 

Reprinted in part in Nineteenth-Century Literature Criticism, Vol. 50:  Criticism of the Works of Novelists, Poets, Playwrights, Short Story Writers, Philosophers, and Other Creative Writers Who Died between 1800 and 1899, from the First Published Critical Appraisals to Current Evaluations.  James E. Person, Jr., Ed., Catherine C. Dominic and Marie Lazzari, Associate Eds.  New York:  Gale Research

“International Cooperation to Avert Global Warming: Economic Growth, Carbon Pricing, and Energy Efficiency” Journal of Environment and Development 1, 1992

Abstract

This paper develops a global simulation model linking economic growth, population growth, and fossil fuel carbon dioxide emissions. The equations of the model are estimated from historical data on a sample covering most of the countries of the world. The estimated relationships show that while increased economic output tends to be associated with higher CO2 emissions, a rising standard of living also slows down population growth and leads to reduced energy consumption per unit of output. The implication is that, under “business as usual” scenarios, the increase in carbon dioxide emissions is relatively insensitive to rates of economic growth over the medium term (50-70 years). This result suggests that promotion of economic growth in the developing world is likely to be the most effective policy for combatting global warming, because the increased wealth that a pro-growth policy will produce will make it easier for the world to improve energy efficiency and reduce dependence on fossil fuels.

“Carbon Rights and Economic Development: A Property Rights Approach” Critical Review 6, 1992

Abstract

Even in the absence of complete scientific consensus on the magnitude, timing, and regional distribution of the effects of global warming caused by greenhouse gas emissions, it is worthwhile to examine potential policy responses to the prospect of climate change. An internalization of the greenhouse externality based on property rights in carbon emissions offers the potential to promote rather than retard worldwide economic development. As the world economy moves in a market-oriented direction, the arbitrary wealth transfers associated with a carbon-rights distribution plan would dissipate within the time span required for planetary climate management. Thus, the present world situation may provide a new opportunity to reconcile the imperatives of global environmental protection and the promotion of sustained economic growth.

“Barriers within Firms to Energy-Efficient Investments” Energy Policy 21, 1993

Abstract

Many investments in energy efficiency fail to be made despite their apparent profitability. Internal hurdle rates are often set at levels higher than the cost of capital to the firm. Reasons for these practices include bounded rationality, principal-agent problems, and moral hazard. The policy implication is that government can simultaneously improve overall energy efficiency and increase private sector productivity by providing informational and organizational services that go beyond the traditional regulatory framework.

“The Future Through Yesterday: Long-Term Forecasting in the Novels of H.G. Wells and Jules Verne” The Centennial Review 38, 1994

Introductory Paragraph:

Suppose you were living in 1896, the date Arrhenius published his amazing paper on the Greenhouse Effect, and that your profession or intellectual passion was to predict the distant future. What impression might his paper have made, if you happened to encounter it in your studies? Arrhenius was attempting to account for the Ice Ages; he only hinted that the carbon dioxide (“carbonic acid” in the chemical terminology of the times) produced by combustion of coal for industrial purposes could affect the content of the atmosphere.2 Would you have imagined that global warming caused by the burning of fossil fuels might pose a threat to civilization 100 years hence? What, in 1896, might you have visualized about the future course of the development of civilization? The time horizon over which present-day forecasts relevant for climate policy have to be made is just as long. Can we learn anything about whether such forecasts contain meaningful information by looking with hindsight at forecasts made during the nineteenth century? (footnote omitted)