The theory of the firm : microeconomics with endogenous enterprises, firms, markets and organizations

The Theory of the Firm presents a path-breaking general framework for understanding the economics of the firm. The book addresses why firms exist, how firms are established, and what contributions firms make to the economy. The book presents a new theoretical analysis of the foundations of microeconomics that makes institutions endogenous. Entrepreneurs play a central economic role by establishing firms. In turn, firms create and operate markets and organizations. The book provides innovative models of economic equilibrium that endogenously determine the structure and function of economic institutions. The book proposes an 'intermediation hypothesis' - the establishment of firms depends on the effects of transaction costs and on the extent of the market. Read more... Introduction; Part I. The Theory of the Firm: 1. The consumer; 2. The firm; 3. Separation of consumer objectives and firm objectives; Part II. The Entrepreneur in Equilibrium: 4. The entrepreneur; 5. Competition between entrepreneurs; Part III. Human Capital and Financial Capital: 6. Human capital and the organization of the firm; 7. Financial capital and the organization of the firm; Part IV. Intermediation by the Firm: 8. The firm as intermediary in the pure exchange economy; 9. The firm versus free riding; Part V. Market Making by the Firm: 10. The firm creates markets; 11. The firm in the market for contracts; 12. Conclusion