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The option-creating institution: A real options perspective on economic organization: Working paper series--02-04

Scherpereel, Christopher M. (2002) The option-creating institution: A real options perspective on economic organization: Working paper series--02-04. Working Paper. NAU W.A. Franke College of Business.

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Intuition and models guide practicing decision-makers in both their perception of the world and in making inferences about their perceived world. The decision-makers' perception of the world is fundamentally linked to the perspective they possess, and the perspective they possess is linked to the models they accept. This paper contributes a new model, or theory, of economic organization called the option-creating institution (OCI) model. The OCI model is based on a behavioral description of economic agents' adaptation to contingent uncertainties. The focus on uncertainty is a shift from traditional economic models of organization. Thus, the OCI model's advancement requires the adoption of a new perspective. Drawing insights from two existing economic perspectives, exchange and coordination, the real options perspective on economic organization is created. It is argued that the real options perspective matches practicing decision-makers' intuition and the inductive OCI model provides a superior prescriptive guide than the current deductive alternatives.

Item Type: Monograph (Working Paper)
Publisher’s Statement: Copyright, where appropriate, is held by the author.
ID number or DOI: 02-04
Keywords: Working paper, economic organization, economic models, contingent uncertainties
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
NAU Depositing Author Academic Status: Faculty/Staff
Department/Unit: The W.A. Franke College of Business
Date Deposited: 18 Oct 2015 00:24
URI: http://openknowledge.nau.edu/id/eprint/1633

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