NBER

Sarah Kaplan

University of Toronto Rotman School
105 St. George St.
Toronto, ON M5S 3E6
http://rotman.utoronto.ca/sarah.kaplan/
Canada
Tel: 416-978-7403

E-Mail: EmailAddress: hidden: you can email any NBER-related person as first underscore last at nber dot org
Institutional Affiliation: University of Toronto

NBER Working Papers and Publications

December 2005Inertia and Incentives: Bridging Organizational Economics and Organizational Theory
with Rebecca Henderson: w11849
Organizational theorists have long acknowledged the importance of the formal and informal incentives facing a firm%u2019s employees, stressing that the political economy of a firm plays a major role in shaping organizational life and firm behavior. Yet the detailed study of incentive systems has traditionally been left in the hands of (organizational) economists, with most organizational theorists focusing their attention on critical problems in culture, network structure, framing and so on -- in essence, the social context in which economics and incentive systems are embedded. We argue that this separation of domains is problematic. The economics literature, for example, is unable to explain why organizations should find it difficult to change incentive structures in the face of environm...

Published: Henderson, Rebecca and Sarah Kaplan. "Inertia an dIncentives: Bridging Organizational Economics and Organizational Theory." Organization Science 16, 5 (Sept-Oct 2005): 509-521.

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