Organosis and Growth of Firms, Sectors and Countries
Chapter 3: The Role of OIs in the Theory of Economic Growth
3. The role of OIs in the theory of economic growth 3.1 INTRODUCTION In Chapter 2, a historical review of the economies of the USA and Japan revealed the nature and the importance of various OIs. The ﬁrst question to answer subsequent to this review is how OIs ﬁt into the preoccupations of economists and other scholars and, consequently, how OIs ﬁt into the process of economic growth. In this study, the latter is deﬁned as changes in the rate of either real output, or productivity (total factor or labour productivity1). When necessary, reference will be made to the growth in employment or other related variables, although it is not a primary concern in this study how these variables (including employment) are related to economic growth.2 In this chapter the foundations for the inclusion of the impact of OIs on the process of industrial growth are laid. Although economic growth is not the same as economic growth in general (the latter includes growth of the services, agriculture and mining sectors), most of the analysis carried out in this chapter is related to economic growth (whereas industrial growth will be more explicitly dealt with in Chapter 4). In this chapter, some ‘hidden’ mechanisms of economic growth and development are explored. In brief, there are some scholars who, for example, have expressed the need to consider or emphasize the impact of OIs per se; this is reviewed in the second section together with some other relevant economic concepts. The third section...
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