The Creative Response in Firms

Over the last fifteen years a more complete list of benefits and costs of decentralization in firms has emerged. The benefits are increased knowledge coordination and innovation. They result from

Over the last fifteen years a more complete list of benefits and costs of decentralization in firms has emerged. The benefits are increased knowledge coordination and innovation. They result from better alignment of decision-making power with the employees holding the most appropriate knowledge and typifications. On the other hand, the costs arise from increased opportunism, incentive misalignment and institutional instability.

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