DOI: 10.1007/s00191-005-0260-1 J Evol Econ (2005) 15: 393–421 c  Springer-Verlag 2005 Knowledge, hierarchy and the selection of routines: an interpretative model with group interactions Nathalie Lazaric and Alain Raybaut GREDEG/CNRS and University of Nice – Sophia Antipolis, DEMOS, Economic Dynamics, Markets and Organizations, 250 rue A. Einstein, 06560 Valbonne, France (e-mail: {lazaric,raybaut}@idefi.cnrs.fr) Abstract. The aim of this paper is to analyze the selection of routines inside an organizational structure characterized by different cognitive representations and facing hierarchical pressure leading to either truce or conflict. After a brief discus- sion of the role of hierarchy and the related problems of organizational practice selection in the evolutionary literature, we model the interactions between different groups within a firm trying to interfere with its coordination mechanisms in order to support their own practices. Numerical simulations highlight the different learning abilities present in various organizational set-ups and their related knowledge dis- tribution. It is shown that networking designs are the most profitable organizational configurations because of their dynamics of learning, though they are very sensitive to the truce problem. Keywords: Hierarchy – Knowledge – Routines – Selection – Complexity JEL Classification: L14, L20, L22, B52, D83 Introduction A lot of attention has been devoted to the social context of knowledge production, for example whether it occurs in a centralized or a decentralized context as stressed by Marengo (1992), because its effect on cognitive frameworks is deemed to be far from neutral (Garicano, 2000; Amin and Cohendet, 2004). Moreover, the idea that knowledge should not be understood simply as a pure cognitive process, but should rather also be seen as a locus in which the political dimension becomes critical, seems to be quite promising (Cohendet, Llerena and Marengo, 1998). However, Correspondence to: N. Lazaric