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In recent years transaction cost economics have come to dominate the discussion of the nature and organization of firms. In Transaction Costs Economics and Beyond Michael Dietrich offers a critical exploration of transaction costs. He argues that whilst they have much to offer, they are still an inadequate basis for a general theory of the firm. Drawing on theories of organizational behaviour as well as economics, he concludes by offering a theory of the firm that allows for both hierarchical and creative decision making.
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