Very good piece by Arnold Kling on the differences between large and small organisations.
If large organizations are dehumanizing, then why do they exist? Brad DeLong says that my assessment of large organizations must be incorrect, or else we would not have Wal-Mart.
A point Kling doesn't make about Wal-Mart is that it is a fairly young organisation. It was in the 1970s that it became a really large organisation, and in the 1980s that it became spectacularly huge. As I have pointed out previously, it is over time that the bad effects of states and other large organisations accumulate. After thirty years, Wal-Mart is a very effective organisation, but one would expect the problems to start soon. The massive state-managed economy Britain instituted in the 1940s started falling apart in the 1970s, and the Soviet organisation set up through the 1920s and 30s probably peaked in effectiveness in the early 60s. Small organisations can stay effective indefinitely.
This piece by Paul Graham is also relevant - describing the Venture Capital / takeover cycle as a way of getting more of the best of both worlds.