PROFESSOR OLIVER WILLIAMSON

Professor Oliver Williamson

Professor Oliver Williamson

Introduction

The Royal Academy of Sciences awarded the Nobel Prize in Economics 2009 two American professors, Ostrom and Williamson, the universities of Indiana and California, respectively, for their work on "the organization of the economy." They were awarded the Nobel Prize for their separate work in economic governance. Together they laid the groundwork for the investigation of rapid growth in economic discipline.

Answer # 1: Professor's Williamson Contribution to Management and Economics

The beginning of Williamson's contributions back to the mid-60's with his studies on rationality, marking a before and after the traditional microeconomic theory. The rationale of Williamson research resulted in two different views which led to further research programs of different nature. (William, 1988, 101-119)

The main thesis of Oliver Williamson is that markets, hierarchical organizations and businesses are the best ways to organize different methods for resolving economic disputes. The Williamson implies that traders are more likely to carry out their transactions in a business relationship, the more specific assets.

Oliver Williamson is one of the leading U.S. economists, Professor, University of California, a member of the editorial board of the prestigious specialized publication Journal of Economic Methodology. The main problem, which is the subject of studies of Williamson, is a question of resolving corporate conflicts. Williamson's focus on the costs of transactions has led him to distinguish between repeated case-by-case bargaining on the one hand and relationship-specific contracts on the other.

He also came into conflict with the general opinion prevailed before, according to which market and hierarchically arranged organizations have different approaches to resolving conflicts of interest. In his opinion, a decisive factor here is the extent of interaction of assets, that is, the level of competition. If the market is highly competitive struggle, conflicts are resolved easily and quickly, as buyers and suppliers can apply to another buyer or supplier.

Williamson's answer is different, in a hierarchical organization; those who wield power can be abused. By exploiting their subordinates by arrogating compensation incommensurate with their real utility for the organization by selecting strategies that satisfy their personal desires to the detriment of the collective interest, etc. Hierarchies have the disadvantage can lead to abuse. The market transaction will be more effective if the benefits of conflict resolution are less important than the disadvantages associated with abuse of the hierarchy. The question then is what determines the interest of resolving conflicts. If there is no conflict, there is no reason to seek a procedure for conflict resolution. If a contract can resolve all potential conflicts resulting from a transaction, the contract will trade and merchants. If contracts cannot be complete if the transaction involves many unknowns and implicit elements, it will tend to be internalized within an organization.

Major Works

He made groundwork for the investigation of rapid growth in economic. His work in the field of control theory and inter-corporate transactions became the basis for many practical applications - from new methods of transnational corporations and the theory of conflict with intra-corporate ...