KNOWLEDGE AS A FACTOR OF EVOLUTIONARY PROGRESS WITHIN THE THEORY OF FIRM

The article highlights a new path along which the theory of the firm evolves. The author wishes to point out how the evolutionary progress in the theory of the firm brings about increasingly improved understanding of knowledge. The concession required for this improvement is a dismissal of some restrictive assumptions of the neoclassical theory. The author argues that there appears to be a trade-off between the benefits of the neoclassical consistency and the costs of more contemporary theories of the firm, which fail to comprehend the complex nature of knowledge.