Misesian Ownership and Coasian Authority in Hayekian Settings: the Case of the Knowledge Economy

The present article is taken up with the dynamics of economic organization. In particular, it critically discusses much recent work which has asserted that economic organization—notably, the boundaries of firms, internal organization, and corporate governance—will undergo major transformative changes as a result of the emergence of the so-called “knowledge economy,” a term much fancied by business administration and management scholars (Prusak 1997; Neef 1998). An Austrian perspective is a particularly fitting starting point for such an exercise. Surely, Austrian economists—who have always been occupied with analyzing the discovery, dispersion, and use of knowledge—will not be surprised to learn that we live in a knowledge economy. To Austrians, all economies are, in a broad sense, “knowledge economies.” This calls for clarification of the concept. However, like its (somewhat overlapping, but nonidentical) “new economy” counterpart in economics, the knowledge economy notion covers many different phenomena,1 and as in the case of the new economy, the evidence for these phenomena is somewhat scant, perhaps contrary to the impression provided by the considerable media (and some academic) hype. Recent research has established that some of the changes usually packed into the notion, notably