The Firm as a Semilattice of Activity: Prolegomenon to a Theory of the Firm

35 Pages Posted: 11 Oct 2009

See all articles by Keiran Sharpe

Keiran Sharpe

University of New South Wales

Abstract

This paper develops a new theory of agency in which agents make use of hierarchies of plans which they successively select and refine until they have plans of action that can be implemented. Each hierarchy of plans has the structure of a semilattice. This analytical decision making framework is used to explore such issues as: why firms exist, how they operate in more or less entropic environments, and how bounded rationality impacts on their ability to settle upon optimal plans. The theory is in a preliminary stage of development.

Keywords: planning, hierarchy, semilattice, theory of the firm

JEL Classification: D21, D81

Suggested Citation

Sharpe, Keiran, The Firm as a Semilattice of Activity: Prolegomenon to a Theory of the Firm. Australian Conference of Economists 2009 Paper. Available at SSRN: https://ssrn.com/abstract=1484746 or http://dx.doi.org/10.2139/ssrn.1484746

Keiran Sharpe (Contact Author)

University of New South Wales ( email )

Sydney, NSW 2052
Australia

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