If our theory of the firm suggests that joint production is more efficient than individual production and that firms exist as a solution to the maximization problem, which of the following is inconsistent with that theory?
A)specialization and division of labor
B)shirking
C)decreasing returns to scale
D)transaction costs

Question

Quizplus · Accepted Answer

Shirking is inconsistent with the theory because it implies that individuals may not work as efficiently within a firm as the theory suggests, undermining the idea that joint production within firms is more efficient due to solutions to the maximization problem.

If Our Theory of the Firm Suggests That Joint Production