- Title Pages
- Dedication
- Preface
- 1 Modern Value Quandaries
- 2 Theories of Value
- 3 The Failure of the Neoclassical Investment Rule
- 4 The Nature of the Firm
- 5 The Organization and Scale of Private Business
- 6 Accounting for the Firm
- 7 VALUE IN CLASSICAL ECONOMICS
- 8 VALUE IN NEOCLASSICAL ECONOMICS
- 9 MODERN RECURSIVE EQUILIBRIUM AND THE BASIC PRICING EQUATION
- 10 ARBITRAGE-FREE PRICING IN COMPLETE MARKETS
- 11 Portfolio Pricing Methods
- 12 Real Options and Expanded Net Present Value
- 13 Traditional Valuation Methods
- 14 PRACTICAL APPLICATION OF THE INCOME METHOD
- 15 THE VALUE FUNCTIONAL: THEORY
- 16 The Value Functional: Applications
- 17 APPLICATIONS: FINANCE AND VALUATION
- 18 Applications: Law and Economics
- Appendix A Key Formula and Notation Summary
- Appendix B Guide To The Solutions Manual
- Appendix C Description of Subject Companies
- References
- Index
The Nature of the Firm
The Nature of the Firm
- Chapter:
- (p.44) (p.45) 4 The Nature of the Firm
- Source:
- The Economics of Business Valuation
- Author(s):
Patrick L. Anderson
- Publisher:
- Stanford University Press
This chapter presents three competing definitions of the firm, including a common definition of any organization that has a profit motive, a modern neoclassical definition of a transaction institution whose incentives differ from those of its owners, and a new three-part definition. The elements of the new definition of the firm include an organization with a profit motive for its investors, a separate identity, and replicable business practices.
Keywords: neoclassical Economics, agency theory, transactions theory, replicable business practices, three-element definition of the firm
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- Title Pages
- Dedication
- Preface
- 1 Modern Value Quandaries
- 2 Theories of Value
- 3 The Failure of the Neoclassical Investment Rule
- 4 The Nature of the Firm
- 5 The Organization and Scale of Private Business
- 6 Accounting for the Firm
- 7 VALUE IN CLASSICAL ECONOMICS
- 8 VALUE IN NEOCLASSICAL ECONOMICS
- 9 MODERN RECURSIVE EQUILIBRIUM AND THE BASIC PRICING EQUATION
- 10 ARBITRAGE-FREE PRICING IN COMPLETE MARKETS
- 11 Portfolio Pricing Methods
- 12 Real Options and Expanded Net Present Value
- 13 Traditional Valuation Methods
- 14 PRACTICAL APPLICATION OF THE INCOME METHOD
- 15 THE VALUE FUNCTIONAL: THEORY
- 16 The Value Functional: Applications
- 17 APPLICATIONS: FINANCE AND VALUATION
- 18 Applications: Law and Economics
- Appendix A Key Formula and Notation Summary
- Appendix B Guide To The Solutions Manual
- Appendix C Description of Subject Companies
- References
- Index
