Wouter Dessein
Columbia University



(Monday, 22nd May 2017)

Title : The Management and Organizational structure of Large Organizations

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In modern economies, many industries are dominated by large organizations, consisting of many divisions, often producing multiple products or services. In this lecture, we will discuss a number of models which deal with three key issues large organizations face:

  • Allocation of decision rights (Managerial hierarchies)
  • Provision of Incentives: Trade-off between incentives and coordination.
  • Structuring of communication flows or "attention": Need for organizational focus.

Bibliographical references :

Students are recommended to read the starred references in advance.

Aghion and Tirole (1997): "Formal and real authority in organizations." Journal of Political Economy

Dessein (2002). "Authority and communication in organizations." The Review of Economic Studies

*Alonso, Dessein, and Matouschek (2008). "When does coordination require centralization?" The American economic review

Stein (2002): "Information Production and Capital Allocation.'' Journal of Finance.

* Dessein, Garicano and Gertner (2010). "Organizing for Synergies." American Economic Journal: Micro

Friebel and Raith (2010): "Resource Allocation and Organization Form." American Economic Journal: Micro

Dessein (2014): "Incomplete Contracts and Firm Boundaries: New directions." Journal of Law, Economics and Organization.

Dessein, Galeotti and Santos (2016). "Rational Inattention and Organizational Focus." American Economic Review.