Organizational Science Meets Law and Economics

Abstract

‘Law and economics’ as well as ‘organizational science’ are well-established disciplines, which are concerned with the explanation of organizational behaviour. However, both disciplines do not collaborate, in order to get more scientific insight in the functioning of organizations. While ‘law and economics’ is mainly applied microeconomics and follows the rational actor model, ‘organizational science’ is fragmented into diverse scientific approaches, thereby relaxing the assumption of rational behaviour. In this essay the differences between both disciplines are dicussed and the possibilities for a productive collaboration are evaluated. In addition, the study includes two applications which demonstrate the added value of a collaboration of the two disciplines: (1) The regulation of energy firms and (2) organizational tort liability.

Keywords: Organizational Science, Law and Economics