"The mark of a capitalistic society is that resources are owned and allocated by such nongovernmental organizations as firms, households, and markets. Resource owners increase productivity through cooperative specialization and this leads to the demand for economic organizations which facilitate cooperation. When a lumber mill employs a cabinetmaker, cooperation between specialists is achieved within a firm, and when a cabinetmaker purchases wood from a lumberman, the cooperation takes place across markets (or between firms). Two important problems face a theory of economic organization—to explain the conditions that determine whether the gains from specialization and cooperative production can better be obtained within an organization like the firm, or across markets, and to explain the structure of the organization."
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University of California, Los Angeles facultyAcademics from the United StatesEconomists from the United StatesPeople from Chicago
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p. 777, Lead paragraph
https://en.wikiquote.org/wiki/Harold_Demsetz
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Harold Demsetz
(May 31, 1930 – January 4, 2019) was an American economist, and Professor Emeritus of Economics at the (UCLA). Demsetz belonged to the , and was one of the pioneers of New Institutional Economics.
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