The basic goal of the dissertation is to understand how different institutional settings, technologies and social preferences could foster different, rival, or complementary organizational forms. The first essay argues that as a consequence of generalized increasing returns to scale, the network externalities in advertising and marketing inhibit the emergence and proliferation of partnerships in the software industry in contrast to legal services. We first construct a model after Rowthorn and Pagano (1996) to illustrate the choice of organizational form under two different types of agency costs: high-agency costs of labor and high-agency cost of capital. Using the US Economic Census Data (1997) we find that there is a negative relationship between the fraction of partnerships in a sector and the average share of advertisement in total expenses in that sector. The second essay uses a large comprehensive and new dataset on Turkish microenterprises to illustrate the importance of institutional complementarities between the credit market and the organizational choice. Employing a generalized selection model following Lee (1983), in the first stage we regress the choice of credit on selected exogenous variables and obtain the selection variable (the inverse Mills ratio). In the second stage we regress log monthly profit on variables describing firm and entrepreneurial characteristics controlling for sectors and the selection bias for separate groups of firms. The empirical results show that both the formal and the informal firms are credit constrained; indeed the formal firms are more credit constrained. Knowing this, we claim it would not be rational for the small informal firms to incur the "entry cost" of formalization if they do not have sufficient assets in the first place. The third essay takes the arguments on the potential negative effects of heterogeneity on economic performances of partnerships seriously and provides a preliminary test in a very simple setting of two-agent firms. Controlling for the selection bias (endogenous choice of the organizational form by the agents) we find almost no effect of heterogeneity on the economic performances of microenterprises, proxied by monthly profit.

While there is a general impression expressed by many in the media and among policy makers that the economy is becoming more globalized and internationally competitive, these claims are not agreed upon among economists. This dissertation attempts to clarify the validity of these crucial claims through empirical research. This dissertation focusses on one aspect of economic internationalization and integration--the behavior of U.S. multinational manufacturing corporations and their foreign direct investment activities. The research presented here attempts to test two main hypotheses; first, that the extent of internationalization within U.S. manufacturing firms has grown in the recent past and, second, that production abroad by U.S. manufacturers substitutes for production in the domestic U.S. economy by these firms. Using industry data from the Department of Commerce Surveys of U.S. Direct Investment Abroad, this dissertation supports the view of growing globalization by U.S. manufacturing multinational firms in the period from the late 1970s through the 1980s as measured by a range of measures. In particular, the data show that slow or non-existent domestic production growth combined with steady growth in foreign production to result in increased internationalization for these firms. The Department of Commerce data is also consistent with the claim that U.S. multinational manufacturing firms are increasingly substituting away from their domestic production base towards production in foreign countries in response to lower factor costs abroad. Next, merging the Compustat Industrial File and the Compustat Geographic Segment File allowed the construction of a unique cross-section, time-series data set of 123 U.S. manufacturing multinational firms. Employing this firm level data, regression analysis is used to test if foreign production growth by U.S. manufacturing firms represents a substitution away from domestic production. Results of the analysis suggest that whether increased internationalization will displace domestic growth for a U.S. manufacturing firm is dependent on the degree of indebtedness of the firm and the concentration of its foreign operations in low wage areas of the world. For the high debt firms in the sample, the substitution effect of foreign growth on domestic growth outweighs the stimulating effect, while the opposite is true for less indebted firms. Regression analysis also shows a tendency for foreign affiliate growth to substitute for domestic growth when the firm's foreign operations are concentrated in developing countries, a result consistent with the analysis of the Department of Commerce data described above.

This dissertation analyzes the relation between industrial organization, technological change and economic policy-making. The secrets to long-term growth are hidden in this complex relation, which explains the forces that enable and hinder learning in production. The recent changes in the international economy are surveyed--changes in technologies, changes in the organization of production and work and changes in the structure of firms. The resulting change in the nature of competitiveness calls for a different theoretical framework and policy recommendations from traditional economic analysis. The study reviews the problems of the liberalization paradigm in economic development. The development theories that flourished in the 1950s and 1960s provided an early basis for concern with industrialization. Nevertheless, economic development theories have underplayed the importance of technological and organizational efforts. Economic development is redefined as a combination of a learning process and innovation. In the light of these ideas, the different stages in the industrial history of Argentina are reinterpreted. The transformations that are redefining the international automobile industry are reviewed, namely, changes in production methods, technological changes, inter-firm relations and international strategies. The implications of these changes are explored for the less developed countries that aim to have a future role in the industry. A strategic sector analysis is applied to the automobile industry in Argentina. This sector is of particular interest because it was an important force driving idiosyncratic import substitution efforts in the 1960s and is a test case for incomes, trade and sector promotion and protection policies in the 1990s. Drawing on case-study evidence from plant visits, the accumulated learning and future learning potential of the sector are evaluated. This potential is examined across four dimensions: the development of strategic, organizational, technological and learning capabilities. The study concludes with a reassessment of the conventional debates in traditional theory and policy-making. It argues for the need to move away from old dichotomies which fail to address how organizational and technological change interact to contribute to long-term growth.

Why do some workers who apparently perform similar tasks and exercise similar job skills get paid very different wages? And, why do firms have the boundaries we observe; in particular, why do firms using closely related production technologies and serving closely related markets specialize instead of merging? That is, how do labor and product market segments emerge, and why might they persist in a competitive economy? I offer an integrated explanation for the striking case of the emergence of such market segments in for-hire motor freight, after its deregulation in 1980. Using firm-level data, I provide econometric evidence of the survival value of carrier specialization, as a result of either original status or strategic change, into one of two types. I also document the associated bimodal segmentation of the labor market for drivers/freight handlers. I argue that a difference in optimal human resource policies between the two types of firms is an important cause of the parallel segmentations. Differences in how similar production technologies are used to serve the two markets mean that firms have different optimal solutions to the agency problem they face in motivating employees, leading to high powered incentives at reservation wages in one case, and low powered incentives with positive rents in the other. But this difference in compensation schemes sharply increases the agency or transaction costs involved in bringing both types of production under common hierarchical control, due to pay equity effects, while the corresponding benefits are modest, leading most firms to specialize. To formalize this account, I extend a simple version of the standard “risk-sharing” principal agent framework by adding a reciprocity component, producing a new model with endogenous segmentation of the specified type. The new model also provides new hypotheses about the source of union wage differentials, and details a mechanism by which technological change can lead to increasing inequality in labor incomes that is distinct from the usual differential returns to skills account.

This dissertation develops a new non-essentialist theory of the global trade policies pursued by the contemporary state, focusing especially upon modern tariff policy. Though a topic attracting perhaps unprecedented analysis throughout the history of economic thought, this understanding differs from existing theory in two important ways: (i) its incorporation of overdeterminist logic in understanding the workings of a deeply interconnected world economy; (ii) its utilization of class theory in delineating the existence of manifold processes of surplus value creation and distribution comprising a global class structure. In these two concepts, overdetermination and class, this dissertation presents a new understanding of trade controls, and a new argument against their use as economic policy. Case studies include examination of the emergence and impact of trade protection in post-colonial American society, and new insight into the rise of the Asian Miracle economies and New Protectionism of the late twentieth century.

This dissertation is primarily a comparison of the ways that different theories address social phenomena. As an important sub-theme, it is about relationships among theories, targeted social issues, and political actions. I argue that among the infinite processes that constitute any particular process are alternative theories (explanations of the social totality). A conscious acknowledgment of alternative theories and their respective entry points is important because it has a significant bearing on decisions regarding political actions that may affect the social totality. The targeted social issue used as an example in this dissertation is the international trade of hazardous waste, with a specific focus upon U.S.-Mexico trade of electric arc furnace dust. There are two dominant economic theories that help shape current political actions regarding international trade of hazardous waste: Neoclassical and World-Systems theories—both essentialist in epistemology and ontology. I show that Neoclassical theory calls for the policy of free trade in hazardous waste, while World-Systems theory calls for the policy of trade bans in hazardous waste between OECD and non-OECD countries. Both theories assume that theory is the primary determinant of policy and that policy will necessarily achieve the stated objective (maximum material well-being for Neoclassical theory and the end of unequal exchange between developed and peripheral countries for World-Systems theory). A third, relatively-new theory that is not widely known is Marxian Class theory, which is nonessentialist in both epistemology and ontology. It has a very different conception of policy than essentialist theories. Marxian Class theory views itself as one among an infinite number of processes that helps shape political interventions, which it views as being among an infinite number of processes that help to shape the stated objective. Because of its unique entry points, the class process and overdetermination, it has the potential to focus attention on the otherwise ignored process of exploitation. This theory is therefore in a unique position to help push the social totality toward elimination of this injustice, and to help create alliances among those whose foci may differ but whose larger goals are to create a less toxic and more equitable social totality.