Why do firms exist by Lotta https://padlet.com/LottaTG/firms Collection of different ways of approaching this question en-us 2016-11-17 11:48:19 UTC 2025-10-17 01:42:38 UTC hello@padlet.com Group 1 - explain 2 different theoretical approaches to firm existence (list and explain, give examples of firms) LottaTG https://padlet.com/LottaTG/firms/wish/138359829 2016-11-17 11:50:41 UTC https://padlet.com/LottaTG/firms/wish/138359829 Group 2 - explain what are transaction costs (3 types and give min2 examples of each cost) LottaTG https://padlet.com/LottaTG/firms/wish/138359960 2016-11-17 11:51:21 UTC https://padlet.com/LottaTG/firms/wish/138359960 Group 3 - what is the information theoretic approach? explain and give examples of info imperfections that firms can address. LottaTG https://padlet.com/LottaTG/firms/wish/138360338 2016-11-17 11:53:15 UTC https://padlet.com/LottaTG/firms/wish/138360338 Group 4 - what are some of the similarities between consumer and producer theory. List at least 3 areas and explain. LottaTG https://padlet.com/LottaTG/firms/wish/138360580 2016-11-17 11:54:37 UTC https://padlet.com/LottaTG/firms/wish/138360580 Group 5 -What is are some of the limitations of neoclassical producer theory - what about transaction costs theory? List at least 3 and explain. LottaTG https://padlet.com/LottaTG/firms/wish/138387165 2016-11-17 13:41:35 UTC https://padlet.com/LottaTG/firms/wish/138387165 Group 5 - limitations of producer and transaction cost theory LottaTG https://padlet.com/LottaTG/firms/wish/138439183 1) technology is defined narrowly through effects on productivity (i.e. how to increase product volume ]]> 2016-11-17 15:31:43 UTC https://padlet.com/LottaTG/firms/wish/138439183 Group 1 - theoretical approaches of why firms exist LottaTG https://padlet.com/LottaTG/firms/wish/138440609 1) profit maximisation in a firm is a (more) efficient way to allocate productive resources
2) firms may exist because a particular econ of scale is required to produce (e.g. mining)
3) transaction costs theory understands firms to exist because there are costs associated with production and getting to market (search/info costs, bargaining/decision and enforcement costs)
4) competence based theories see firms as places to store and develop cumulative knowledge
5) knowledge (similar to competence) based theories see firms as places where new ideas and new ways of packaging can emerge (specific to firms)]]> 2016-11-17 15:34:59 UTC https://padlet.com/LottaTG/firms/wish/138440609 Group Numero 2 https://padlet.com/LottaTG/firms/wish/138445632 What are transaction costs: Cost of exchange be it financial……..or non financial.

Search and information costs: (include costs in determining that the required good is available on the market, i.e. which has the lowest price) 

Example: weekly shop, Money Supermarket

Bargaining costs: (costs required to come to an acceptable agreement with the other party to the transaction)

Example: cost of procurement team, contract costs

Policing and Enforcement costs: (costs of making sure the other party sticks to the terms of the contract)

Example: Bailiffs, cost of legal team (Wikipedia, 2016)
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