What is the significance of Oliver Williamson's Nobel Prize? This short article is an attempt to answer this question briefly. First, he demonstrated when it is more efficient for the firm to make the component in the house, and not delegate it to another firm. Second, his work was groundbreaking, as economic studies at the time was pretty much obsessed with the market operations and management firms as black boxes production. Williamson did the work of economic scientists understand the need to analyze the governance and incentives within and between firms in order to better understand how performance can be maintained in a capitalist society. Thirdly, his original ideas and research area, he first-transaction cost economics, to offer clear guidance for business strategy and public policy. "Hide
by Steven Tadelis Source: California Management Review 9 pages. Publication Date: 01 February 2010. Prod. #: CMR454-PDF-ENG
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