A market based approach for resolving resource constrained task allocation problems in a software development process

We consider software development as an economic activity, where goods and services can be modeled as a resource constrained task allocation problem. This paper introduces a market based mechanism to overcome task allocation issues in a software development process. It proposes a mechanism with a prescribed set of rules, where valuation is based on the behaviors of stakeholders such as biding for a task. A bid process ensures that a stakeholder, who values the resource most, will have it allocated for a limited number of times. To observe the bidders behaviors, we initiate an approach incorporated with a process simulation model. Our preliminary results support the idea that our model is useful for optimizing the value based task allocations, creating a market value for the project assets, and for achieving proper allocation of project resources specifically on large scale software projects

Dynamics of incentives and value creation in (de-)centralised incentive systems

When young and small organisations grow into medium-sized organisations they often implement monetary incentive systems with unclear consequences. Whilst implemented to increase employee (innovative) output and value creation, they have ambiguous effects and may even reduce value creation. Due to the different effects of monetary incentives, this paper distinguishes reciprocal and opportunistic employees’ different reactions to incentives. It analyses the effects of decentralised incentive systems – and thus of incentive systems targeted better at opportunistic vs. reciprocal employees – on value creation. Here, it proposes a causal feedback structure explaining opportunistic and reciprocal employees’ different reactions and it investigates by simulation how incentives and value creation interact over time. The analysis reveals that behaviour is not pre-determined by employee disposition. It shows how dynamics evolve dependent on the interrelationships of employee dispositions and the organisational context. As such, it exemplifies the usefulness of studying dynamics of incentive systems and employee behaviour

Economic Organization in the Knowledge Economy Some Austrian Insights

I critically discuss recent claims about economic organization in the emerging “knowledge economy,” specifically that authority relations will tend to disappear (or at least become radically transformed), the boundaries of the firm will blur, and coordination mechanisms will be much more malleable than assumed in organizational economics, resulting in various “new organizational forms.” In particular, the price mechanism will be used inside hierarchies to a much greater extent. In order to obtain an analytical focus on the knowledge economy, I assume that it may be approximated by “Hayekian settings” (after Hayek 1945), that is, settings in which knowledge is distributed and where knowledge inputs are relatively more important in production than physical capital inputs. I then argue, drawing on organizational economics as well as Mises’ insights in property rights and comparative systems, that the presence of Hayekian settings does not mean that authority will disappear, etc., although economic organization will in fact be affected by the emergence of the knowledge economy. This suggests that Austrian economics has an important contribution to make to the study of economic organization.Economic organizations, Austrian economics