Growth Maximisation Theory of Marris:
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This unique Handbook explores both the economics of the firm and the theory of the firm, two areas which are traditionally treated separately in the literature. On the one hand, the former refers to the structure, organization and boundaries of the firm, while the latter is devoted to the analysis.
Baumol’s Sales or Revenue Maximisation Theory: Assumptions, Explanation and Criticisms! Prof Baumol in his article on the theory of Oligopoly presented a managerial theory of the firm based on the sales maximisation.
3. The firm’s minimum profit constraint is set competitively in terms of the. I. Rationalisation of the Sales Maximisation Hypothesis: Baumol offers several justifications of sales maximisation as a goal of the firm. The separation of ownership from management, characteristic of the modern firm, gives discretion to the managers to pursue goals which maximise their own utility and deviate from profit maximisation, which is the desirable goal of owners.
Management Models of Baumol, Marris and Williamson. Williamson developed an agency model, the basis of the model was economic theory, markets were seen as medium where efficient exch.
Nevertheless, Baumol (), Marris () and Williamson () offer models that are best applicable to the Indian context and for Joint Stock Companies that have to deal with the problem of separation of ownership of control.