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- Title
Behavioral Theory of the Firm: Historical Perspectives Influencing Current Applications.
- Authors
Harlan, Estle
- Abstract
When Richard M. Cyert and James G. March wrote A Behavioral Theory of the Firm (BTF) in 1963, they opened the mysterious black box of organizational behavior by reporting on actual observations of firms' internal processes. Traditional theory declared that firms were rational decision makers, and they sought to maximize profits and other values through means of perfect knowledge. BTF posited that coalitions or groups within firms made actual organizational decisions, decisions were based on bounded rationality, and decision makers sought to satisfice their aspirations through means of limited knowledge. This article describes the concepts of BTF, the influence of those concepts on subsequent theories of organizational behavior, and the evolving applications of theory to organizational practices.
- Publication
Ethics & Critical Thinking Journal, 2014, Vol 2014, Issue 2, p78
- ISSN
1547-5425
- Publication type
Academic Journal