Munich Personal RePEc Archive

Fallacies, Collapses, Crises. Now What?

Lazarides, Themistokles and Drmmpetas, Evaggelos (2009): Fallacies, Collapses, Crises. Now What?

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Abstract

The current crisis has been seen as the result of a “few bad apples”. The paper argues that the crisis is systemic and based on fallacies and misconceptions in the design and function of the economic – corporate system. Organizational and economic theories are based on hypotheses that lead to faulted decisions on how the system should be regulated and designed. The paper proposes that a new theory is needed. Disjoint approaches of the current situation are not suitable. Law, Organization theory, Economics, Finance and Accounting need to converge in order to formulate a theory that encompasses all factors and it is holistic. Introduction of corporate governance systems that are as dynamic as the organizational, ownership, product and capital market are, are necessary in order to create a stable and effective corporate environment.

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