The Nature Of The Business: From The Entrepreneurs Point Of View Of The Dialysis

The firm theory research has been in the dilemma of rigor and usefulness till now. However, a good firm theory should be a fusion of formal scientific theory and live artistic practice. It is quite within the reason to believe that view and analysis of the firm nature from the entrepreneur angle can not only make the firm theory more scientific but also add new vigor to firms marching towards success in the real world.What is the nature of firms? Why do they exist? What determines their scope? To answer these central questions in the firm theory satisfactorily, view of the firm must be against the background of the long history river. Through rethinking the concepts of human need, nature supply, ownership, labor, division of labor, human capital and so on, and through analyzing vast practical data, especially firsthand information, the dissertation develops an answer to each of these questions as follows. Firms are a form of industrial organization in the market. They exist for the purpose of earning more profits and their boundaries are drawn where their profit functions are maximized. Principles of economics tell us that firms' profits stems from their monopoly power, therefore, firms can be defined as a form of industrial organization existing for extending monopoly and creating new monopoly in the market and thus earning more profits.In fact, at the root of firms with monopoly power is the intellectual property owned by human capital, particularly top human capital. The key problem is why human capital, which itself has monopoly power and can make profits, wears a coat in the form of firms. It is found through research that firms can extend the monopoly that human capital has and can thus earn more profits than human capital. In this sense, firms can be viewed as the externalization of human capital.Although it seems that any attempt to eliminate people's misunderstanding about monopoly is futile, an overall and systematic analysis of monopoly can surely deepen people's positive understanding about monopoly. The concepts of absolute monopoly and relative monopoly presented in the dissertation provide useful analytic tools forthe theory and practice concerning firm success. A firm's success depends not only on its capacity of developing ideals in the minds of customers, but also on its ability in right positioning, systematic planning and unswerving execution.Of course, rethinking of the concepts of labor, human capital, top human capital and so on cannot directly become any part of the firm theory; nevertheless, the firm theory must be pale and weak without these tools.