Forms of Economic Organization

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= From Walter Powell’s seminal paper on networks as neither hierarchies nor markets

Graphic at http://3.bp.blogspot.com/_u1GIE0NHH8g/SgtrCNeVOOI/AAAAAAAAABU/08b2mtUAOSk/s400/powell+figure.jpg


Commentary

David Ronfeldt:

"This is a classic table, the first by an economic sociologist to add networks to the traditional dichotomy of hierarchies and markets as the paradigmatic options that business enterprises face. His particular focus was on craft and high-tech industries. What the table (p. 300) indicates is that, by comparison, network designs are (more?) relational, reputational, open-ended, and nimble. Among the points that the table misses but the text notes is that networks may also excel at gathering and processing information. I also like the point in the text (p. 303) that “In essence, the parties to a network agree to forego the right to pursue their own interests at the expense of others.” However, this kind of behavior is not unique to networks — it often crops up in other organizational settings as well." (http://twotheories.blogspot.com/2009/05/organizational-forms-compared-my.html)

Source: http://www.stanford.edu/%7Ewoodyp/papers/powell_neither.pdf