Farewell to the nobel of economics, Oliver Williamson famous for his studies on transaction costs

Oliver Williamson, emeritus professor of Organization and Economics at the Haas School of Business of the University of Berkeley, died Thursday night at 87, from complications related to lung disease. Williamson, a shy scholar but loved by many colleagues who friendlyly called him Olly, was a disciplinary boundary, since he connected the theories of industrial economics to the strategy and organization of business thinking and to the paradigms of legal studies contracts.

He received the Nobel Prize in 2009 for his studies oriented to redesigning organizational boundaries and corporate governance. His workhorse was the elaboration of the “transaction costs”, which outline and safeguard a market agreement. Based on the works designed by famous American scholars such as Coase and Commons, the transaction costs allow you to define the “make or buy” process with which companies decide to internalize or outsource a production process. And therefore to set how much and how companies can grow and thrive based on their own processes or managed by an external supplier.

With an unconventional horizon in economic theory, Williamson’s seminal book “Markets and Hierarchies” (1975 and Italian translation in 1983 for the types of Il Mulino) explains that the goal is always to minimize transaction costs, especially in uncertain and incomplete contracts, where the limited rationality of the actors and the opportunism of the contractual parties can prevail. After his work on the markets and hierarchies, which also laid the foundations for the line of studies called “neo-institutionalist economics”, no subsequent researcher has been able to imagine the sub-supply relationships according to previous theories; joint ventures, long-term contracts, the efficiency of bureaucracy have had to deal with the Williamsian approach. Friend of Italy, the American scholar began to be studied in depth around the beginning of the 1980s. Bocconi University was the first in 1982 to insert Williamson’s translation “Organization and Markets” among the textbooks for students of business economics, although it was certainly not a work of very easy metabolization, and the border paradigm was very useful. in reflections on the strategic processes of outsourcing and outsourcing of production and services.