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dc.contributor.authorVan Zandt, Timothy-
dc.contributor.authorRadner, Roy-
dc.date.accessioned2006-02-06T14:23:49Z-
dc.date.available2006-02-06T14:23:49Z-
dc.date.issued1999-08-
dc.identifier.urihttp://hdl.handle.net/2451/14278-
dc.description.abstractWe use a model of real-time decentralized information processing to understand how constraints on human information processing affect the returns to scale of organizations. We identify three informational (dis)economies of scale: diversification of heterogeneous risks (positive), sharing of information and of costs (positive), and crowding out of recent information due to information processing delay (negative). Because decision rules are endogenous, delay does not inexorably lead to decreasing returns to scale. However, returns are more likely to be decreasing when computation constraints, rather than sampling costs, limit the information upon which decisions are conditioned. The results illustrate how information processing constraints together with the requirement of informational integration cause a breakdown of the replication arguments that have been used to establish nondecreasing technological returns to scale.en
dc.format.extent30407117 bytes-
dc.format.mimetypeapplication/pdf-
dc.languageEnglishEN
dc.language.isoen_US-
dc.publisherStern School of Business, New York Universityen
dc.relation.ispartofseriesIS-99-03-
dc.subjectreturns to scaleen
dc.subjectreal-time computationen
dc.subjectdecentralized information processingen
dc.subjectorganizationsen
dc.subjectbounded rationalityen
dc.titleReal-Time Decentralization Information Processing and Returns to Scaleen
dc.typeWorking Paperen
dc.description.seriesInformation Systems Working Papers SeriesEN
Appears in Collections:IOMS: Information Systems Working Papers

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