- ability-to-pay principle
- absolute advantage theory
- absolute income hypothesis
- abstinence theory of interest
- acceleration principle
- adaptive expectations
- adding-up problem
- adverse selection
- agency theory
- aggregate demand theory
- Allais paradox
- anarcho-syndicalism
- arbitrage pricing policy
- Arrow-Debreu model
- asymmetrical information
- axiomatic theories
- balanced budget multiplier
- bathtub theorem
- benefit approach principle
- Bernoulli's hypothesis
- Bertrand duopoly model
- bilateral monopoly
- bimetallism
- bioeconomics
- bionomics
- bounded rationality
- bourgeoise
- bureaucracy
- business cycle
- Cambridge capital controversies
- capital asset pricing model
- capital logic
- capital theory
- capture theory
- catallaxy
- catastrophe theory
- central place theory
- CES production function
- class struggle
- classical macroeconomic model
- classical theory of money
- clubs, theory of
- co-operative games theory
- Coase theorem
- Cobb-Douglas production function
- cobweb theory
- collective bargaining theory
- collusion theory
- colonialism
- commodity theory of money
- comparative advantage theory
- comparative costs
- compensation principle
- composite commodity
- Condorcet's principle
- consumer demand, theory of
- consumer surplus
- contestable markets theory
- continuity thesis
- contract theory
- convergence theory
- core, theory of the
- corporatism
- cost-benefit analysis
- cost-push inflation
- countervailing power
- Cournot duopoly model
- Cramer's rule
- crisis of capitalism
- crowding hypothesis
- crowding-out
- currency principle
- customs union theory
- cyclical theory
- decision theory
- DeLorean theory
- demand for money theory
- demand theory
- demand-pull inflation
- demographic transition
- dependency theory
- differential rent theory
- diminishing returns, law of
- disequilibrium theory
- distribution theory
- distributism
- dual decision hypothesis
- dual economy theory
- dual labor market theory
- duopoly theory
- economic liberalism
- economic methodology
- economic theory of politics
- economic theory of the state
- efficient market hypothesis
- Engel's law
- entitlement theorem
- envelope theorem
- equal sacrifice theory
- equilibrium theory
- error learning hypothesis
- Euler's theory
- exploitation
- externalities
- factor-price equalization theorem
- falling rate of profit
- fine tuning
- firm, theory of the
- fixed point theorems
- forced saving
- free banking theory
- free rider problem
- fundamental disquilibrium
- game theory
- general equilibrium theory
- general strike
- general theory of employment, interest and money
- Gibrat's rule of proportionate growth
- Giffen paradox
- golden rule of capital accumulation
- gold standard
- gravity model
- Gresham's law
- group theory
- growth of the firm, theory of the
- growth-pole theory
- Harrod-Domar growth model
- Heckscher-Ohlin trade theory
- Hicks-Hansen model
- historical materialism
- Hotelling's law
- human capital theory
- imperfect competition
- imperialism
- impossibility theorem
- income determination, theory of
- income distribution, theory of
- information theory
- input-output analysis
- insider-outsider wage determination
- internal and external balance
- invisible hand
- iron law of wages
- IS-LM model
- just price
- Keynesian economics
- Kondratieff cycles
- labor force participation
- labor market discrimination
- labor theory of value
- Laffer curve
- laissez-faire
- large numbers, law of
- Le Chatelier principle
- learning-by-doing
- least cost location theory
- Leontief paradox
- life-cycle hypothesis
- Lindahl equilibrium
- linear programming
- loanable funds theory of the rate of interest
- long wages
- lump-of-labor theory of wages
- Lyapunov's theorem
- machinery question
- Malthusian population theory
- managerial theories of the firm
- marginal efficiency of capital
- marginal productivity theory of distribution
- marginal utility theory
- market socialism
- markets, law of
- Marshall-Lerner principle
- Marxism
- material balances principle
- measure theory
- mercantilism
- Modigliani-Miller theory of the cost of capital
- monetarism
- monopolistic competition
- monopoly
- monopoly capitalism
- moral hazard
- multiplier
- multiplier-accelerator
- NAIRU
- NARU
- Nash equilibrium
- national income
- nationalization
- natural and warranted rates of growth
- natural monopoly of economics
- natural rate of unemployment
- negative income tax
- neo-classical growth theory
- neo-classical theory
- neo-Ricardian theory
- new class
- new classical macroeconomics
- non-accelerating inflation rate of unemployment
- non-competing groups
- non-nested hypothesis
- non-profit organization
- occupation segregation
- Okun's law
- oligopoly theory
- opportunity cost
- optimal tariff theory
- option pricing theory
- organization theory
- own rate of interest
- paradox of thrift
- paradox of value
- paradox of voting
- Pareto efficiency
- Pareto optimality
- partial equilibrium theory
- peak-load pricing
- perfect competition
- permanent income hypothesis
- Phillips curve
- Physiocracy
- Pigou effect
- political business cycle
- portfolio selection theory
- Prebisch-Singer thesis
- price discrimination
- privatization
- product life-cycle theory
- production, theory of
- profits, theories of
- property
- public choice
- public utility pricing
- purchasing power parity
- quantity theory of money
- queuing theory
- Ramsey pricing
- random walk hypothesis
- rational expectations theory
- rationing
- Rawls theory of justice
- Reaganomics
- real bills doctrine
- regulation
- regulatory capture
- relative income hypothesis
- rent seeking
- returns to scale
- revealed preference theory
- Ricardian equivalence theorem
- roundabout method of production
- Rybczynski theorem
- satisficing
- Say's law
- Scitovsky paradox
- screening hypothesis
- search theory
- second best, theory of
- secular stagnation theory
- segmented labor market theory
- shadow pricing
- signalling
- Slutsky's theorem
- small is beautiful principle
- social welfare function
- Solow economic growth
- specie-flow mechanism
- St Petersburg paradox
- stationary state
- stock-flow analysis
- structure-conduct-performance theory
- substitution theory
- sunspot theory
- supply-side economics
- surplus value
- syndicalism
- tax incidence
- technological gap theory
- term structure of interest rates
- Thatcherism
- Tiebout hypothesis
- time preference theory of interest
- trade cycle
- trickle-down theory
- turnpike theory
- uncertainty
- underconsumption theory
- unemployment
- variable proportions, law of
- vent for surplus
- Verdoorn's law
- wages fund doctrine
- Wagner's law
- Walras's stability
- Weber's theory of the location of the firm
- Wicksell's theory of capital
- x-efficiency
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Theory of the Firm
(1838)
Theory of the firm is an analysis of the behavior of companies that examine inputs, production methods, output and prices.
The first elementary examination of companies was made by French economist Antoine Augustin Cournot (1801-1877) and later modified by (among others) English political economist Alfred Marshall (1842-1924).
The traditional theory assumes that profit maximization is the goal of the firm. More recent analyses suggest that sales maximization or market share, combined with satisfactory profits, may be the main purpose of large industrial corporations.
Also see: theory of the growth of the firm, satisficing, organization theory, bureaucracy, agency theory
Source:
O E Williamson, The Economics of Discretionary Behaviour: Managerial Objectives in a Theory of the Firm (Englewood Cliffs, N.J., 1964)
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