since we know that marbles end up at the bottom of bowls because in that state there is a minimum of potential energy.

If we assume that manufacturing a Barbie requires less productive knowledge than manufacturing a car (and it probably does), then we can conclude that the manufacturing was spread out not because making a Barbie doll requires more knowledge and knowhow than a firm can contain, but because the reduction in the costs of establishing international

Another distinction that I should mention up front is the one between information as something and information about something, such as the information we transmit in a message. Think of a car. I can tell you that my car is red and has a six-speed manual transmission and a 1.6 liter engine. This is all information about my car, but it is not the

To hold large volumes of knowledge and knowhow, therefore, we need large networks of people. Yet the relationship between the size of a network and the volume of knowledge and knowhow that it can hold not only makes the accumulation of knowledge and knowhow difficult but also implies that moving or copying the knowledge and knowhow embodied in a

a parsimonious way of understanding the islands of central planning that we know as firms is to search for the point at which the cost of transactions taking place internally within the firm equals the cost of market transactions. When the external transactions become less costly than the internal transactions, firms stop growing, since it is

economic development is based not on the ability of a pocket of the economy to consume but on the ability of people to turn their dreams into reality. Economic development is not the ability to buy but the ability to make.

information emerges naturally in the steady states of physical systems that are out of equilibrium.

James Coleman,

firmbyte. It is analogous to the personbyte, but instead of requiring the distribution of knowledge and knowhow among people, it requires them to be distributed among a network of firms.3