Tuesday, February 15, 2011

Os limites naturais à dimensão das empresas

Merger Monday and the Destruction of Wealth

Murray Rothbard extended Mises's analyses to considering the size of firms, and the problem of resource allocation under socialism to the context of vertical integration and the size of an organization. He wrote that the

ultimate limits are set on the relative size of the firm by the necessity of markets to exist in every factor, in order to make it possible for the firm to calculate its profits and losses.

To make implicit estimates, there must be an explicit market. "When an entrepreneur receives income, in other words, he receives a complex of various functional incomes," Rothbard wrote. "To isolate them by calculation, there must be in existence an external market to which the entrepreneur can refer."

As firms get too big, economic calculation gets muddied because firms do not receive the profit-and-loss signals for their internal transactions. Managers are lost as to how to allocate land and labor to provide maximum profits or to serve customers best.

As these firms grow (especially by acquisition), one part of the company is often the provider and another part of the company is the customer, yet there are no market prices to allocate resources efficiently.


Professor Klein makes the point that

as soon as the firm expands to the point where at least one external market has disappeared, however, the calculation problem exists. The difficulties become worse and worse as more and more external markets disappear, as [quoting Rothbard]

"islands of noncalculable chaos swell to the proportions of masses and continents. As the area of incalculability increases, the degrees of irrationality, misallocation, loss, impoverishment, etc, become greater."

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