Technological Choice under Organizational Diseconomies of Scale

With adverse selection, diseconomies of scale associated with hierarchies may induce the implementation of a second-best technology. This occurs whenever rents to lower tiers of the hierarchy increase faster than total surplus. This is more likely with longer hierarchies.

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Year of publication:	2006
Authors:	Demougin, Dominique ; Schöttner, Anja
Institutions:	Sonderforschungsbereich Ökonomisches Risiko <Berlin>
Subject:	Technologie \| technology \| Hierarchie \| Adverse Selektion \| Economies of scale \| ECONOMIES OF SCALE

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1. Introduction
2. The model
3. The two-tier hierarchy
4. The multi-tier hierarchy - an example
5. Conclusion
6. Appendix

Persistent link: https://www.econbiz.de/10005857930