TITLE

Transaction Cost, Specialization and Division of Labor --A General Equilibrium Analysis of Entrepreneurship under Globalization

AUTHOR(S)
Ke Li
PUB. DATE
February 2014
SOURCE
World Journal of Neuroscience;Feb2014, Vol. 4 Issue 1, p34
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
This paper develops a Walrasian general equilibrium model based on transaction cost and specialization to investigate the evolution and role of entrepreneurship in a competitive market under globalization. The implication of our model is straightforward that if the entrepreneurship in a competitive market under globalization is efficient, it will ensure the network and effects of division of labor can be fully exploited when the gains from the division of labor outweigh the costs of exchange between individuals of different specialization patterns with the different fixed learning costs. Hence, the entrepreneurship service in a competitive market under globalization can promote aggregate productivity by enlarging the scope for trading off network effects of the division of labor on aggregate productivity against transaction costs. To business practitioners, this model suggests that the entrepreneurship service is a key element of business viability during which a major transition took place in human activity. Besides, the improvement of the level of globalization and the general transaction efficiency coefficient will increase the level of division of labor and the per capita real income level of participants.
ACCESSION #
94739636

 

Related Articles

  • THE EMERGENCE OF TECHNOLOGY ENTREPRENEUR AND ECONOMIC GROWTH. Guoqiang Li // Review of Business Research;2007, Vol. 7 Issue 3, p137 

    Based on Yang and Ng's model, this paper will study the emergence of technology entrepreneur from the perspective of saving transaction cost. Inframarginal analysis (total cost-benefit analysis across corner solutions in addition to marginal analysis of each corner solution) of the model has...

  • On optimality of illegal collusion in contracts. Lambert-Mogiliansky, Ariane // Review of Economic Design;1998, Vol. 3 Issue 4, p303 

    Abstract. Illegal collusion is a widespread phenomenon all around the world. Yet, models of hierarchical agency relationships tend not to predict collusion. This paper demonstrates that a natural requirement of interim efficiency suffices for collusion to appear in equilibrium in a simple...

  • Globalização, especialização territorial e divisão do trabalho: Patrocínio e o café do Cerrado mineiro. Vicente Pereira, Mirlei Fachini // Cuadernos de Geografia;jul-dic2014, Vol. 23 Issue 2, p239 

    The era of globalization is marked by the proliferation of events that expand modern productive circuits in the territory, while at the same time specializing locations. In Patrocinio, a municipality of Minas Gerais specialized in coffee production, it is possible to observe the new imperatives...

  • THE PRACTICAL ADAPTATION AND SOME ECONOMIC ASPECTS OF THE INTERNATIONAL ACCOUNTING STANDARDS. Beke, Jeno // Studia Universitatis Babes-Bolyai, Oeconomica;2010, Vol. 55 Issue 2, p41 

    This paper traces the benefits of international accounting standards - their contribution to harmonization and globalization. The differences between the national accounting rules and the international accounting standards are compared, measured and valued inside and outside of the European...

  • Computing equilibria in finance economies with incomplete markets and transaction costs. Jean-Jacques Herings, P.; Schmedders, Karl // Economic Theory;Mar2006, Vol. 27 Issue 3, p493 

    Transaction costs on financial markets may have important consequences for volumes of trade, asset pricing, and welfare. This paper introduces an algorithm for the computation of equilibria in the general equilibrium model with incomplete asset markets and transaction costs. We show that...

  • Sharecropping, Production Externalities, and the Theory of Contracts. Roumasset, James // American Journal of Agricultural Economics;Nov79 Part 1, Vol. 61 Issue 4, p640 

    Abstracting from transactions costs, the equilibrium bargaining solution with sufficient traders is equivalent to the Walrasian equilibrium. For a sharecropping economy, this proposition establishes the validity of the competitive theory of share tenancy. For an economy with production...

  • Entrepreneurial Strategies and the Structure of Transaction Costs in Russian Business. Radaev, Vadim // Problems of Economic Transition;Apr2002, Vol. 44 Issue 12, p57 

    Examines the efficacy of the entrepreneurial strategies and structure of transaction costs applied in the Russian businesses. Acquisition of property rights and access to resources; Collection of data and advertising; Protection of property rights.

  • THE ROLE AND IMPACT OF INTERNATIONAL ECONOMY DURING GLOBALIZATION ERA. Turkeshi, Neritan // Knowledge: International Journal;Mar2019, Vol. 30 Issue 1, p159 

    In the contemporary conditions of economization, one cannot think of the economic development of a country as well as the world economy without reciprocal economic relationships between the countries. Therefore, the foreign trade represents an important activity within the area of trading and...

  • Urban Development in the United States, 1690-1990. Kim, Sukkoo // Southern Economic Journal;Apr2000, Vol. 66 Issue 4, p855 

    The United States transformed itself from a rural to an urban society over the last three centuries. After a century of unremarkable growth, the pace of urbanization was historically unprecedented between the nineteenth and the early twentieth centuries. In the twentieth century, the urban...

Share

Read the Article

Courtesy of THE LIBRARY OF VIRGINIA

Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics