Business Alone or Business Together: The Entrepreneurial Contract and Efficiency
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| Title | Business Alone or Business Together: The Entrepreneurial Contract and Efficiency
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| Author | Wang Peijun and Wu Negnquan |
| Organization | management college, sun yat-sen university |
| Email | wangpj2000@yahoo.com.cn |
| Key Words | Transmission of Knowledge; Efficiency Difference; The Positive and Negative Effect on Income; Establish Contracts; Entrepreneurial Efficiency |
| Abstract | The nature of the enterprise is not the opposite of the market, but a competitive union consists of individual market participants, and another type of business participating way in contrast to participating individually. If a cognitive object has two different knowledges, it means that the owner of the knowledge would have different effectiveness in dealing with their mutual cognitive object. When knowledge is transferring to people on one's own side, the benefits will rise alone with the improvement of work efficiency, however, when knowledge is transferring to rivals, the previous benefits will be harmed due to the competition. As a result, the function of the entrepreneurial contract is to distinguish between insiders and outsiders, to make sure that the investment and knowledge is not used for competition. And the instinct of the entrepreneurial contract is a long-term non-competitive union against outside competition. The efficiency comes from knowledge exchange of members that improve the efficiency when dealing with cognitive objects or reduce costs. That is why enterprises take place of self-employed business. |
| Serial Number | WP327 |
| Time | 2012-08-29 |
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