Some Transaction Cost Effects of Authoritarian Management

Todorova, Tamara and Vasilev, Aleksandar (2017) Some Transaction Cost Effects of Authoritarian Management. International Journal of the Economics of Business, 24 (3). pp. 295-314. ISSN 1357-1516

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This paper studies the transaction cost economizing effects of
authoritarian management in organizations and systems subject to higher transaction
costs originating from various sources. We analyze the nature, mechanisms, and
transaction cost aspects of the authoritarian management style. We argue that the
higher the transaction costs of internal organization, the more autocratic the manager
is likely to be. We discuss the features of authoritarian managers, illustrating some of
our key hypotheses with the example of Henry Ford and his running of the Ford
Motor Company. In the context of non-market economies, we relate authoritarian
leadership to economic centralism in high transaction cost systems such as East
European societies with significant transactional or organizational opportunism, as
well as other sources of market failure.

Additional Information:The final published version of this article can be accessed online at
Keywords:Authoritarian Management; Transaction Costs; Opportunism; Unitary Structure; Information Transfer; Transitional Economies.
Subjects:N Business and Administrative studies > N220 Institutional Management
N Business and Administrative studies > N210 Management Techniques
Divisions:Lincoln International Business School
ID Code:33189
Deposited On:22 Oct 2018 15:19

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