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Journal Article

From Inside the Firm to the Growth Process

David Martimort and Thierry Verdier
Journal of the European Economic Association
Vol. 1, No. 2/3, Papers and Proceedings of the Seventeenth Annual Congress of the European Economic Association (Apr. - May, 2003), pp. 621-629
Published by: Oxford University Press
Stable URL: http://www.jstor.org/stable/40005211
Page Count: 9
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Since scans are not currently available to screen readers, please contact JSTOR User Support for access. We'll provide a PDF copy for your screen reader.
From Inside the Firm to the Growth Process
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Abstract

This paper argues that the internal organization of the firm and the growth process interact strongly to determine simultaneously the power of incentives within the firm and the growth rate. We show how agents within the firm can invest either by using their own human capital or by relying on some form of reputational capital to secure implicit relationships within the firm and we discuss how these investments affect the growth rate of the economy.

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