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From Employment to Entrepreneurship

PublicationArticle (with peer review)
Entreprenörskap, Företagandets villkor, Gunnar Eliasson, Sysselsättning

Abstract

Technology is making smaller scale, distributed production more economical, raising global competition and forcing change on traditional firms in mature markets. Change was gradual for decades but accelerated during the last ten or fifteen years as new computing and communications (C&C) technologies helped coordinate production flows, making firms break up and distribute their value chains over markets of subcontractors and changing the work environment of individuals. I investigate the consequences for individuals of the faster creative destruction process that is taking place through the turnover of firms rather than internally within firms. I conclude that labour market risks are changing such that entrepreneurial ability, intellectual flexibility and a capacity to learn efficiently from experience will become competitive advantages for individuals. I also conclude that efficient education may offer a way of countering the ongoing polarization of labour markets and I derive a platform theory of cumulative learning from experience that emphasizes the acquisition of basic skills during early school years. A varied and advanced job environment to learn from is probably the most important factor, sustaining the competitive advantage of the advanced industrial economies. A stylized comparison of the educational and labour market systems suggests that the European systems are at a disadvantage compared to that of the US.

Eliasson, G. (2006). ”From Employment to Entrepreneurship: Shifting Perspectives in Europe and the US on Knowledge Creation and Labour Market Competition.”Journal of Industrial Relations, 48(5): 633-656.

Based on content

The Nature of Economic Change and Management in a New Knowledge Based Information Economy
Article (with peer review)Publication
Eliasson, G.
Publication year

2005

Abstract

The development of management theory and practice and their informational assumptions are followed over three phases of economic development; (1) the pre-oil crisis experience 1969–1975, (2) the post oil crisis sobering up through most of the 1990s and (3) the emergence of globally distributed production organizations, blurring the notion of the firm to be managed. The change from a belief in a predictable environment and only marginally uninformed actors to an increasing recognition of the fundamental ignorance that enters all business decisions, the consequent business mistakes and that learning between the periods has been of limited value and often misleading is found to be reflected in business information systems.
The increased rate of failure among large firms in recent decades appears to be related to the increasing complexity of business decisions, the decreased reliability of learning and the difficulties of controlling the value chain in globally distributed production.

Working Paper No. 119. Advanced Purchasing, Spillovers, Innovative Pricing and Serendipitous Discovery
Working paperPublication
Eliasson, G.
Publication year

2008

Abstract

Advanced products such as aircraft distinguish themselves by a number of characteristics. Products are complicated and produced under very complicated circumstances, but also have a very long life. The purchase price, therefore, is a small part of total user cost of the product. Product value, hence, increases the more of cost efficient maintenance that has been built into the product and the easier it is to service and modernize. Advanced products also distinguish themselves by featuring the additional collective characteristic of a “cloud of technology spillovers” available to external users in proportion to their competence to commercialize them. While the value of that cloud to society may be greater than that of the product itself the value to the user may be much smaller. The producer, therefore, faces a tricky pricing problem and the value he can capture depends on his ability to charge for the dual product. I discuss joint production of products with rich spillovers in the context of joint customership, i.e. public purchasing of both products and the collective value generated by spillovers. I demonstrate that a win-win situation might exist between the two that improves with the commercial ability of the local economy to capture the value of the spillovers. Industrial participation programs can be made part of a sale to support the receiver competence of local producers to capture the spillover rents. Part of marketing the product, therefore, involves the ability to present a credible case for the economic value to society of the spillovers and to design a method of charging for them (Innovative pricing). A well designed, mutually beneficial contract should make both parties to the trade winners. This latter form of innovative pricing should be particularly attractive for developing countries. The theoretical argument is illustrated with the case of downstream industrial business formation around Swedish Aircraft industry.

Working Paper No. 119. Advanced Purchasing, Spillovers, Innovative Pricing and Serendipitous Discovery
Working paperPublication
Eliasson, G.
Publication year

2008

Abstract

Advanced products such as aircraft distinguish themselves by a number of characteristics. Products are complicated and produced under very complicated circumstances, but also have a very long life. The purchase price, therefore, is a small part of total user cost of the product. Product value, hence, increases the more of cost efficient maintenance that has been built into the product and the easier it is to service and modernize. Advanced products also distinguish themselves by featuring the additional collective characteristic of a “cloud of technology spillovers” available to external users in proportion to their competence to commercialize them. While the value of that cloud to society may be greater than that of the product itself the value to the user may be much smaller. The producer, therefore, faces a tricky pricing problem and the value he can capture depends on his ability to charge for the dual product. I discuss joint production of products with rich spillovers in the context of joint customership, i.e. public purchasing of both products and the collective value generated by spillovers. I demonstrate that a win-win situation might exist between the two that improves with the commercial ability of the local economy to capture the value of the spillovers. Industrial participation programs can be made part of a sale to support the receiver competence of local producers to capture the spillover rents. Part of marketing the product, therefore, involves the ability to present a credible case for the economic value to society of the spillovers and to design a method of charging for them (Innovative pricing). A well designed, mutually beneficial contract should make both parties to the trade winners. This latter form of innovative pricing should be particularly attractive for developing countries. The theoretical argument is illustrated with the case of downstream industrial business formation around Swedish Aircraft industry.

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