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THE ECONOMICS OF DECOMPOSITION: RESOURCE ALLOCATION VS TRANSFER PRICING

Publication ,  Journal Article
Burton, RM; Damon, WW; Loughridge, DW
Published in: Decision Sciences
January 1, 1974

Two distinctively different decomposition algorithms have been developed. Both are analagous to decentralized decision making in the firm. One essentially deals with the allocation of corporate resources by the use of transfer prices charged to the divisions, while the other deals with the direct allocation of fixed quantities of the corporate resources to each division. The analogy of a price coordinated, or transfer pricing, technique to decentralization was developed by Baumol and Fabian [1] and later by Kim [4]. The second approach to decomposition was developed by Kornai and Liptak [5] [6] in an attempt to formulate the planning problem in a Socialist economy. It is the purpose of this paper to develop the analogy of the resource allocation decomposition to decentralized decision making. Copyright © 1974, Wiley Blackwell. All rights reserved

Duke Scholars

Published In

Decision Sciences

DOI

EISSN

1540-5915

ISSN

0011-7315

Publication Date

January 1, 1974

Volume

5

Issue

3

Start / End Page

297 / 310

Related Subject Headings

  • Business & Management
  • 35 Commerce, management, tourism and services
  • 1505 Marketing
  • 1504 Commercial Services
  • 1503 Business and Management
 

Citation

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MLA
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Burton, R. M., Damon, W. W., & Loughridge, D. W. (1974). THE ECONOMICS OF DECOMPOSITION: RESOURCE ALLOCATION VS TRANSFER PRICING. Decision Sciences, 5(3), 297–310. https://doi.org/10.1111/j.1540-5915.1974.tb00617.x
Burton, R. M., W. W. Damon, and D. W. Loughridge. “THE ECONOMICS OF DECOMPOSITION: RESOURCE ALLOCATION VS TRANSFER PRICING.” Decision Sciences 5, no. 3 (January 1, 1974): 297–310. https://doi.org/10.1111/j.1540-5915.1974.tb00617.x.
Burton RM, Damon WW, Loughridge DW. THE ECONOMICS OF DECOMPOSITION: RESOURCE ALLOCATION VS TRANSFER PRICING. Decision Sciences. 1974 Jan 1;5(3):297–310.
Burton, R. M., et al. “THE ECONOMICS OF DECOMPOSITION: RESOURCE ALLOCATION VS TRANSFER PRICING.” Decision Sciences, vol. 5, no. 3, Jan. 1974, pp. 297–310. Scopus, doi:10.1111/j.1540-5915.1974.tb00617.x.
Burton RM, Damon WW, Loughridge DW. THE ECONOMICS OF DECOMPOSITION: RESOURCE ALLOCATION VS TRANSFER PRICING. Decision Sciences. 1974 Jan 1;5(3):297–310.
Journal cover image

Published In

Decision Sciences

DOI

EISSN

1540-5915

ISSN

0011-7315

Publication Date

January 1, 1974

Volume

5

Issue

3

Start / End Page

297 / 310

Related Subject Headings

  • Business & Management
  • 35 Commerce, management, tourism and services
  • 1505 Marketing
  • 1504 Commercial Services
  • 1503 Business and Management