Jump to ContentJump to Main Navigation
A Course in Microeconomic Theory$
Users without a subscription are not able to see the full content.

David M. Kreps

Print publication date: 2020

Print ISBN-13: 9780691202754

Published to Princeton Scholarship Online: May 2021

DOI: 10.23943/princeton/9780691202754.001.0001

Show Summary Details
Page of

PRINTED FROM PRINCETON SCHOLARSHIP ONLINE (www.princeton.universitypressscholarship.com). (c) Copyright Princeton University Press, 2021. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in PRSO for personal use.date: 17 September 2021

Transaction cost economics and the firm

Transaction cost economics and the firm

Chapter:
(p.742) (p.743) Chapter Twenty Transaction cost economics and the firm
Source:
A Course in Microeconomic Theory
Author(s):

David M. Kreps

Publisher:
Princeton University Press
DOI:10.23943/princeton/9780691202754.003.0020

This chapter continues the discussion of the previous chapter about models of the firm, with consideration given to models where the firm is something more like a market than a consumer. It considers how a transaction placed within the context of a firm is different from the “same” transaction placed within a market, which is the subject of transaction cost economics. In transaction cost economics, the unit of analysis is the individual transaction. In this theory, firms are not entities, things of the rough category of the consumer; instead firms are institutions, in the rough category of the market. The line between firms and markets is rather fuzzy, but what line there is is drawn along the dimension of the frequency of interaction, the relative permanence of certain legal and market relationships, and the extent to which parties to a transaction are “tied” to one another.

Keywords:   firms, markets, individual transaction, transaction cost economics, market relationships

Princeton Scholarship Online requires a subscription or purchase to access the full text of books within the service. Public users can however freely search the site and view the abstracts and keywords for each book and chapter.

Please, subscribe or login to access full text content.

If you think you should have access to this title, please contact your librarian.

To troubleshoot, please check our FAQs , and if you can't find the answer there, please contact us.