Organizational Economics - Explained
What is Organizational Economics?
Written by Jason Gordon
Updated at July 19th, 2021
- Marketing, Advertising, Sales & PR
- Accounting, Taxation, and Reporting
- Professionalism & Career Development
-
Law, Transactions, & Risk Management
Government, Legal System, Administrative Law, & Constitutional Law Legal Disputes - Civil & Criminal Law Agency Law HR, Employment, Labor, & Discrimination Business Entities, Corporate Governance & Ownership Business Transactions, Antitrust, & Securities Law Real Estate, Personal, & Intellectual Property Commercial Law: Contract, Payments, Security Interests, & Bankruptcy Consumer Protection Insurance & Risk Management Immigration Law Environmental Protection Law Inheritance, Estates, and Trusts
- Business Management & Operations
- Economics, Finance, & Analytics
- Courses
What is Organizational Economics?
Organizational economics focuses on an individual firm and studies its operations, transactions, management decisions, policies, organizational structure, and plans.
Back to: Management & Organizational Behavior
How does Organizational Economics Work?
Organizational economics has three subfields, these are;
- Agency theory,
- Transaction cost economics and
- Property rights theory.
Aside from studying how a firm is able to coordinate its operations, organization economics also identifies the areas a firm is lacking. This branch of applied economics is most useful in the aspect of firm structure, developing company policies, making management decisions, assessing business risks, implementing incentives and rewards and the overall structure of the firm.