Context and Aggregation: An Experimental Study of Bias and Discrimination in Organizational Decisions

This paper addresses a notable gap at the intersection of organizational economics and organization science: how does organizational context influence aggregation of individual behavior in organizational decisions? Using basic centralized versus decentralized organizational structures as building blocks for our experimental design, we examine whether assignment of organizational positions, incentive schemes, and structural configuration induce endogenous adaptation in the form of change in reservation levels (bias) or modified discrimination capability in subjects’ behavior. We found that evaluators adapted their reservation and discrimination levels in centralized structures, whereas they did not generally adapt their reservation and discrimination levels when placed in decentralized structures. We identify mechanisms that explain these findings; explain how they influence aggregate, organizational behavior; and discuss implications for research and practice.

Atmosphere, private ordering, and industrial pluralism: Williamson's evolving science of organization

The major contribution of Oliver Williamson, who was a 2009 Nobel Prize co-Laureate in economics, consists of proposing a heuristic analysis of governance structures, namely, the firm, the market, and what he will later call the ‘hybrid forms’. This cardinal issue in organizational economics has made it possible to propose rigorous arbitration tools for the famous ‘make or buy’ decisions in modern market economies based on asset specificity and quasi-rents. However, Williamson's work goes far beyond these contributions alone. His contribution is based on a multidisciplinary theoretical background in building the science of organization. This is the important but sometimes neglected aspect of Williamson's work that I wish to highlight in this paper in memory of Williamson in regard to three major pieces on atmosphere (and informal organization), private ordering, and industrial pluralism. In doing so, I also propose reconsidering the different stages of Williamson's evolving science of organization from recent neo-institutional works.

Measuring Collaboration in Modern Organizations

Internal communication has been a central theme in organizational economics, as employee collaboration provides insight into the structure of firms. Use of electronic communications data can be transformational for organizational economics, as these data provide a standardized way to measure organizational communication patterns and to determine the connection between these patterns and firm performance. We discuss the value of data that capture patterns of employee interactions, the benefits and risks associated with the use of electronic communication data (email and meetings) as empirical proxies for these collaboration patterns, and the research possibilities for studies across larger sets of firms.

Knowledge, Stories, and Culture in Organizations

Organizations are full of stories; organizational economics, not so much. Rather, organizational economics has little work that conceptualizes the role or measures the incidence of stories in organizations. This shortage concerns us not only because stories are prevalent in organizations but more importantly because we think some stories play a role in organizations that sheds light on why organizations exist and how they might be improved. In brief, we explore the idea that stories in organizations may induce a particular kind of organizational knowledge, of which organizational culture is a leading example.

March-ing toward organizational economics

I was a student of Jim March’s in 1983, meaning that I took a mandatory 10-week doctoral class on organization theory from him that changed my life. And I have been a student of Jim’s ever since, meaning that I have tried to keep learning from Jim’s ideas—about organizations and about life. During the course and for over a decade afterwards, most of my academic learning from Jim was about how disciplines other than economics think about organizations. More recently, I have tried to discern how the roots of my own field, organizational economics, often involve Jim. This note focuses on the latter, especially informed by precious summer discussions from 2013 to 2018.1

Private Land Conservation and Public Policy: Land Trusts, Land Owners, and Conservation Easements

We highlight the extraordinary growth in private conservation via land trusts and conservation easements and describe the problems arising from the interplay of public finance and private decisions. We offer a framework for understanding the popularity of easements and land trusts and for evaluating policy reforms aimed at improving their performance. The framework, grounded in institutional and organizational economics in the tradition of Ronald Coase, Oliver Williamson, and Yoram Barzel, focuses on the measurement and monitoring costs faced by public and private stakeholders under current and prospective policy arrangements. We illustrate how the framework can be applied to contemporary debates about the appropriate tax treatment of donated easements, requirements that they be held in perpetuity, and the extent to which government should regulate private land trusts.