The Dissemination of Management Consulting Innovations and the Pace of Technological Improvements

Authors: Hansen, Stephen C.; Hughes, John S.

Source: Journal of Institutional and Theoretical Economics JITE, Volume 161, Number 3, September 2005 , pp. 536-555(20)

Publisher: Mohr Siebeck

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Abstract:

This paper models management consultants' decisions about the order of client engagements when the consultant reduces clients' costs. The consultant can either immediately spread the innovation to all clients or sequentially spread the innovation to one client at a time. Licensing agreements, along with learning by doing, enhance the appeal of sequential engagements that delay the dissemination of innovation. However, concurrent engagements, or immediate dissemination, yield more clients who gain cost reductions for more periods. Whether the consultant finds that sequential or concurrent engagements optimal depends on her bargaining power and the magnitude of learning by doing.

Document Type: Research article

DOI: http://dx.doi.org/10.1628/093245605774259327

Publication date: 2005-09-01

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Founded as Zeitschrift f�r die gesamte Staatswissenschaft in 1844.

As one of the oldest journals in the field of political economy, the Journal of Institutional and Theoretical Economics (JITE) deals traditionally with the problems of economics, social policy, and their legal framework. JITE is listed in the Journal of Economic Literature, the Social Science Citation Index, the International Bibliography of the Social Sciences, and COREJ.
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