[T]ying together entrepreneurship and the firm allows for a dynamic and realistic understanding of how the internal organization of the firm is established and the effects it has on performance. The internal organization determines how derived entrepreneurial judgment will be exercised by employees as circumstances change. The owner-entrepreneur exercises original judgment in determining the amount of discretion his employees will have. Thus, entrepreneurship is exercised in some way at every level of the firm. The owners should not be mistaken as passive bystanders to the actions of the firm, for they are the ones who ultimately establish and adjust over time the structure for how entrepreneurship is to be exercised by firm employees.
Friday, October 12, 2012
My student John Dellape's review of Foss and Klein's Organizing Entrepreneurial Judgement continues at Mises.org. Today's offering examine Foss and Klein's explanation of the real nature of capital goods and the connection between the theory of the entrepreneur and that of the firm. As Dellape concludes: