Organizational Governance and Employee Cooperation: Can We Learn from Economists?

Organizational economics attempts to resolve the problem of cooperation through appropriate design of governance structure. The paper argues that this represents a largely static approach, which does not take into consideration the dynamic aspects of design choice, such as the history, the external context and the continuous feedback loop between behavior and choice. Furthermore, organizational economics systematically draws upon sociological concepts, such as trust or social conventions which are variables exogenous to its own framework, and which consequently remain unexplored and unresearched.