11 January 2011

The objective is effectiveness

It is more natural to couch the theory of the firm in terms of gift exchange than in terms of market trades. Gift exchange is less about what's gotten for what and more about what's needed in order to produce what. The firm spends its energy making sure its employees have whatever resources they need to get the job done. The objective is not efficiency so much as effectiveness. 
When the objective is effectiveness, the focus is on what is produced rather than on what is invested. 
When the objective is effectiveness the relationship is complementary rather than competitive, and when the relationship is complementary then the issue is covenantal partnership, and when the issue is covenantal partnership then the focus is on deservedness rather than worth. 
By introducing the criterion of effectiveness into the valuation equation we shift the context from tastes and preferences to engineering considerations. 
The judgment of deservedness is close to the judgment of tribute of various sub-systems to the functioning of the overall system, as well as the evaluation of the contribution of the several elements to the complementary production of some joint product. 
Deservedness could well be what Eve had in her sights when she was tempted to eat of the fruit of the tree of knowledge of good and bad. It would be in keeping with their new-found ability to engage in complementarity that Adam and Eve would then immediately discover their nakedness and, by implication, their sexuality. 

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