Economic organization and transaction cost（经济组织与交易成本）

Economic organization and transaction cost（经济组织与交易成本） Economic organization and transaction cost(经济组织与交易 成本) Economic organization and transaction cost (Economic Organization and Transaction Cost) Dean of University of Hong Kong Institute of Finance and economy Steven Kos (Coase) is an important extension of the theorem, if all transaction costs are zero, regardless of how to arrange the production and exchange activities, the use of resources are the same. This means that, in the absence of transaction costs, institutional or organizational arrangements can provide selection according to this area, cannot be explained by economic theory. Not only the economic organization is determined randomly, but actually does not have what organization of production and exchange activities are just by the invisible hand of the market guide. But the organization or various institutional arrangements do exist, and in order to explain their existence and change, they must be regarded as the transaction cost under the constraints of the results. In the broadest sense, the transaction costs include all those who cannot exist without property rights, no trading, no any kind of economic organization Robinson Caruso (Robinson Crusoe) in the economic cost. Such a broad definition of transaction cost is necessary, because often can't distinguish between various types of cost. This definition, the transaction cost can be seen as a series of system cost, including the cost of information cost, negotiation cost, formulate and implement contract cost, define and control property cost, supervision and management and the system structural change cost. In short, everything does not occur directly in the material production cost. Obviously, these costs are very important, they are called the "transaction costs", may lead to misunderstanding, because they like even in communist countries such as the economy, also looms large. By definition, a total requires people to organize it. In the broadest sense, not all by the invisible hand of the market to guide the production and exchange activities are organized activities. In this way, any director, manager, supervisor, manager, executor, lawyers, judges, agents, or even intermediary activities, means the existence of group level. The occupation in Robinson economy, does not exist, for their work to pay wages, is the transaction cost. When the transaction cost is defined as not all in the economic cost of Crusoe, organizations are also broadly defined as any required visible hand service activities, there is a corollary: organization cost all of the transaction costs, and vice versa. This is why in the past 20 years, economists are always trying to change the transaction cost to explain the reasons of the form of organizational structure. Some obvious examples can illustrate this point. A plant (a tissue) of the workers, by piece or hourly wage to pay wages. If the determination and supervision costs (a type of transaction cost is zero, then) no matter what kind of practice will have the same results. But the cost is greater than zero, if the determination of production cost is relatively low, it is likely a piecework. If the test time and the cost of supervising production than the determination of production cost is low, it may choose to pay. For example, some restaurants (also a group) according to the number of selling food pricing, others implement buffet, in each fixed price, allowing consumers to casual dining. To determine and determine the basic cost and the quantity of food consumed by the food is decided will choose what kind of practice. If there is no transaction cost, factory or restaurant first will not exist, because the owner put consumers will provide services directly from the production of goods and the purchase. In early 1937, R H was used to determine the market price of Coase costs (transaction cost), explains the emergence of manufacturers (organization). When measuring the respective contributions of workers and agreed each part of the price of a product is difficult, so that the transaction cost is large, the workers will choose in a factory (manufacturer) work; He spent his labor contract through the right to use the visible hand of the voluntary compliance management, rather than by the invisible hand of the market to sell his products or services to consumers. It can be said that manufacturers replaced the market. Along with the development of substitution, determine the price of cost savings will meet firm internal supervision and management of the rising cost of the reaction. When the marginal cost of the former and the latter, saving the cost of raising the same, reached equilibrium. Manufacturers replaced on the market can be regarded as elements of the market in the product market to replace. If all transaction costs are zero, so the two markets will be inseparable, because the customer to the owner of production factor payments equal to pay to the product seller payments. In this world, that factor and product markets are two coexisting entities, very absurd. The existence of transaction costs is a prelude to the separation of essential factor market and product market. However, in certain arrangements, for example, the use of a piece rate, a separation market with another market, may become impossible. Therefore, the manufacturer as a substitute for market, or the market as a substitute for the elements of the product market, as well as more correctly and to regard them as a form of contract type alternative to another type of organization selection. In these cases, the organization of choice is actually the choice of contractual arrangements. When the organization chooses as the contract choice, to draw a clear line to an organization with another organization distinguished, is often not possible. For example, manufacturers, holding employment contract (whether entrepreneurs entrepreneurs from hiring workers or workers employment entrepreneurs is not clear), may contract with other manufacturers; contract to contract; then contracting can further contracting; a worker can with several "employer" or "manufacturers" contract. If the contract allows the chain extension, the manufacturers' may include the whole economy. In this view, the size of firms become uncertain and not important. The transaction cost is important contract choice and decision of this choice. The traditional economic analysis limited to resource allocation and income distribution. In this traditional contract arrangement, as a kind of phenomenon has been slighted. In a complicated transaction costs in the world, this not only makes countless ignore interesting phenomena cannot be explained, and in fact the fuzzy understanding of resource allocation and income distribution. In traditional analysis, organization or institution economics or economic system operation, has never been in place. Generations of students have been told, "incomplete", led to some seems to be a mysterious phenomenon: the policy was "misleading", or antitrust experts around the target. The introduction of new and more correct ideas at the expense of some great. Even today, the textbook is only through a fixed salary and pay rent to discuss the theory of marginal productivity. But economists know, (only labor) payment of wages can have piecework wages, bonuses, tips, commissions or other arrangements to share all kinds of external form, even the wage rate can have several. Each kind of contract means the supervision cost, cost and cost determination of different negotiation. Also, whenever you select different contract arrangements, with the visible hand of the role of economic organization will change. Of course, the choice of contract arrangement is not limited to the elements of the market. In the product market, such as tie-in and comprehensive shill, or club membership fee of this pricing arrangement, also can be used to explain the transaction cost. Enterprise merger, franchise and various forms of economic integration organization, is now regarded as the phenomenon of transaction cost. Indeed, careful observation of the department stores and shopping centers, you can find the center between the sellers and the sale of individual agents and their pricing and contract arrangement, these are textbook economics can not explain. The transaction cost is usually difficult to measure, But as mentioned earlier, it is difficult to separate a transaction cost and another transaction cost. However, as long as we can figure out how to change these costs in different visual environment, you can avoid the measurement problem, but if the marginal changes, their different types can be separated. The two conditions in the interpretation of organizational behavior, which can be included in the derivation of test what is necessary. Institutional Analysis of transaction cost (Organization), better than the other three methods. The main research method of stimulation. However, in theory, stimulation is observed, if we use the cost of implementation to study the problem, can better get a verifiable proposition. The second method is to use risk. But it is difficult to determine how the risk of changes in different situations. Many risks, such as protocol can deliver the uncertain problem is the problem of transaction cost directly by transaction cost analysis, more easy to handle. Finally, the transaction cost analysis, some recent progress requires the attention to reflected in dishonesty, fraud, evasion of responsibility and opportunism in the cost. But these are not clear terms, no matter what they draw, was found always to some extent. We can determine the special transaction costs encourage dishonesty extent, this vague explanation is no longer needed. The final to be clear, in what sense, we can say that a person is "more honest" or "more opportunistic"? Transaction cost analysis method of economic organization, can be extended from several participants to the "government" or even country itself. At a lower level, the owners of condominium units can be almost as a specific form of governance rules, their election committee to implement the matters of common concern, the decision is decided by a majority of votes. Vote trading cost under certain conditions by transaction cost and price of $election of small, unimportant things even can be delegated to a "dictatorship" to further reduce the cost of the vote manager. Similarly, a specific area residents can choose to merge into a single city, elect their own mayor, establishment of regulations of the employment Committee, firefighters and police officers, and other matters of public decision. Private property has a unique advantage, allowing individual property ownership can have a choice not to participate in the organization. This choice is a powerful control with high transaction costs of the organization. Indeed, by majority decision principle, a particular area of the family may lose not to participate in a city community choice (unlike a worker, can always be in a free enterprise economy, choose not to join a "manufacturer"). But in a private property rights in the society, the majority principle is to cut transaction costs. Not willing to residents through the exercise of his own judgment, can sell his house, moved to other places. Under the conditions of competition, private property rights to further reduce transaction costs. One would like to recruit other owners of the resources in his organization entrepreneurs or agents in the competition must provide attractive conditions, and only his organization can effectively reduce transaction costs, in order to achieve this point. On the other hand, take the risk of losing his job, the resource owner in order to join in the competition organization, will try more to the business better. When an organization is extended to include the entire country, not to participate in the selection and competition organization effect of course will be limited. If the nationality is determined by birth, do not join the nationality of choice is restricted, the absorption of members of the competition between countries, certainly weaker than among organizations within a country competition. This cost cutting mechanism is lacking in communist countries is more significant. Where citizens have no rights in the internal organization. The Communist state can be regarded as a "super manufacturer", in which the Comrades did not participate in the selection. Every worker is assigned to a specific job, by officials at all levels of the visible hand to monitor and command. In this regard, the Communist state is extremely similar to Coase called the "manufacturer", where workers are being told what to do, rather than by the market price guide. But the Communist state is not due to the lack of market price, determine the price cost; but in the absence of private property rights, the market price does not exist, the administrative agencies at all levels of supervision has become visible legacy of alternative order. The transaction cost management in communist countries than in the free enterprise economy must be high, because the former did not participate in the selection, no interstitial absorption of members of the competition and guide members to work competition. If the transaction cost management is zero, resource allocation and income distribution will be a communist state and in the free enterprise system: consumer preferences can not cost performance; the auctioneer and the supervisor can provide all the information collection and processing services free of charge; workers and other factors of production can not be local command of the best production according to consumer preferences; every consumer can get in line with their own preferences for goods and services; the total income per worker has, in accordance with any without cost, an agreed standards, without cost by an umpire decided and is equal to the marginal productivity of labor in addition to his plus everything outside other resources rent share. However, such an ideal situation is clearly not exist. We conclude that the economic performance of the communist nation, rooted in the organization and management of high transaction cost. Under the assumption that the constraint for the maximum, the same cause of communism national survival with any "low efficiency" organizational survival: namely, change the organization (system) arrangement of transaction cost is very high, so that can't change. This cost includes information about performance of other system cost, use advice or mandatory power to change the status of a privileged group of cost. These privileged group income in other economic organizations, perhaps than in the current system to be low. From: John Eatwell, 1992, "the new Palgrave Dictionary of economics", Economic Science Publishing House Palgrave invited me to write "Coase", "Alchian", "economic organization and transaction cost" and "public property" four items, a point can be proud of the achievements