The Economics of Organization
Spring 2001
MW 9:30-11
Room 311 Monteith
R. N. Langlois
Assignment 5
Consider the following proposition.
In the nineteenth century, decreases in transportation and information costs brought about by the railroad, ocean shipping, and the telegraph transformed the American economy by permitting centralized mass production of standardized products. In the late twentieth century, further reductions in transportation and information costs — from the Internet, telecommunications, and FedEx — have had the opposite effect, reducing standardization lowering the minimum efficient scale of production.
Attack or defend this proposition with a theoretical argument. Readings from the section of the syllabus on “The old economy and the new economy” may help.
Due: April 23.