Knowledge, Beliefs and Economics

Knowledge, Beliefs and Economics

Edited by Richard Arena and Agnès Festré

This book surveys how economists engage with knowledge and beliefs in various fields of economic analysis, such as general equilibrium theory, decision theory, game theory, experimental economics, evolutionary theory of the firm, financial markets and the history of economic thought.

Chapter 12: Informal Communication, Collective Beliefs and Corporate Culture: A Conception of the Organization as a ‘Community of Communities’

Patrick Cohendet and Morad Diani

Subjects: economics and finance, economic psychology


Patrick Cohendet and Morad Diani 12.1 INTRODUCTION This chapter puts forward an interpretation of the firm based on the division of knowledge rather than the division of labour. This kind of perspective gives central importance to collective beliefs and corporate culture, two features of the firm whose importance has greatly increased in the knowledge-based economy. The idea of the firm as a bundle of interacting communities allows us to focus on voluntary cooperative exchange and informal communication as sources of collective beliefs and corporate culture. Given that community-level analysis allows scope for the examination of the creation, validation and diffusion of knowledge, in what follows, it will be considered as complementary to traditional modes of co-ordination of the firm. Many recent works (e.g. Brousseau 2001; Gensollen 2001; Cowan and Jonard 2001) emphasize that in an economy that is increasingly based on knowledge, a growing part of the process of knowledge generation and diffusion relies on the workings of knowledge-intensive communities. These communities consist of frequently interacting agents in a non-hierarchical communication architecture. An important observation emerging from the analysis of such systems of voluntary cooperative exchange is the importance of behavioural norms in guiding the actions of community members and the intensity of the trust relations that underlie them. Most of the current economic literature on communities focuses on the workings of virtual communities by looking at the development of the Internet (Lerner and Tirole 2001) or at scientific communities (Knorr-Cetina 239 240 Agents, communities and collective beliefs 1998)...

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