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We use transaction cost economics (TCE) to define the "digitization of transaction terms" shift parameter that describes the institutional changes associated with increased digitization in society. We then draw on legal scholarship to analyze how strong smart contracts, which refer to agreements with automatic execution and enforcement that are not reversible by courts, rely on a new level of digitization of transaction terms. Specifically, these contracts may rely on standard digital infrastructures such as blockchain systems that guarantee automatic execution and non-reversibility. Strong smart contracts represent a distinct mode of transaction governance compared to markets, hierarchies, or hybrids. This is because each classic governance mode is distinguished by how ex post adaptation is handled—through public courts, managerial fiat, or both. In contrast, strong smart contracts prevent ex post adaptation altogether. We propose that when strong smart contracts can be fully specified, they may dominate other governance modes based on certain trade-offs. These trade-offs include weighing the benefits of avoiding the holdup problem and lowering contract enforcement costs against the downsides of high ex ante specification costs and the elimination of flexibility to make ex post adjustments in a changing environment. Our discussion elaborates on which institutional conditions can further facilitate this institutional shift. [ABSTRACT FROM AUTHOR]

Research on buyer-seller exchange consistently acknowledges the role of uncertainty as an influential factor in decision-making for both exchange parties. However, a fragmented understanding of uncertainty, limitations from data collection, and overreliance on a narrow set of theoretical frameworks has hampered the development of uncertainty as a core concept in sales research. To address these challenges and encourage future research, we conduct a systematic literature review to streamline and synthesize the disparate research on buyer-seller uncertainty. The review process reveals interesting trends in the prevalence of uncertainty research as well as overarching research themes. Discussion of these themes alongside managerial insights help illuminate multiple research gaps that offer fruitful areas for future sales research. The results of this analysis produce an encouraging discussion for sales scholars to reconsider their theoretical, methodological, and conceptual approaches to understand both buyer and seller uncertainty. [ABSTRACT FROM AUTHOR]

This paper introduces the concept of citizenship rent to help explain the apparently contradictory coexistence of liberalising economic reforms and the entrenchment of patriarchal values. Citizenship rent (CR) is defined as the financial flows that move from the state to the citizen in the form of entitlements, employment, and access to state-subsidised goods, labour and business opportunities. Our innovative proposal substitutes transaction cost economics' assumption of market selection for a selection by patriarchy to show how gender plays a central role in the reproduction of the asset specificities that increase transaction costs. This illustrates how an extractive, asset-based economy, like Kuwait's, can afford to double down on conservative social values, even at a considerable fiscal price, as long as the transaction costs of getting oil to the international markets are not increased through social disruption or political uncertainty. Rather than examining how women's social reproductive work subsidises social and political stability, CR reveals women's role in sustaining assets valuable to the state. This paper demonstrates that a close examination of the social values that inhibit transactions can also reveal patriarchal structures in rentier capital and exhibit a need to further analyse the patriarchal transaction costs that shape and sustain societies. [ABSTRACT FROM AUTHOR]

Purpose: This study analyzes the performance implications of adopting blockchain to support supply chain business processes. The technology holds as many promises as implementation challenges, so interest in its impact on operational performance has grown steadily over the last few years. Design/methodology/approach: Drawing on transaction cost economics and the contingency theory, we built a set of hypotheses. These were tested through a long-term event study and an ordinary least squares regression involving 130 adopters listed in North America. Findings: Compared with the control sample, adopters displayed significant abnormal performance in terms of labor productivity, operating cycle and profitability, whereas sales appeared unaffected. Firms in regulated settings and closer to the end customer showed more positive effects. Neither industry-level competition nor the early involvement of a project partner emerged as relevant contextual factors. Originality/value: This research presents the first extensive analysis of operational performance based on objective measures. In contrast to previous studies and theoretical predictions, the results indicate that blockchain adoption is not associated with sales improvement. This can be explained considering that secure data storage and sharing do not guarantee the factual credibility of recorded data, which needs to be proved to customers in alternative ways. Conversely, improvements in other operational performance dimensions confirm that blockchain can support inter-organizational transactions more efficiently. The results are relevant in times when, following hype, there are signs of disengagement with the technology. [ABSTRACT FROM AUTHOR]

The objective of this paper is to understand the industry perspective towards the benefits of embedding blockchain technology (BCT) in global supply chains (GSC). A qualitative approach with the view of transaction cost economics (TCE) and diffusion of innovation (DOI) theory is applied. Semi-structured interviews with 23 industry experts showcased the benefits of application of BCT into GSC and this yielded interesting themes and sub-themes using the thematic analyses first yielding, the critical issues and challenges in traditional supply chains (TSC) and second, how BCT can contribute to overcome these challenges to support digital GSC; and third, possible challenges adapting BCT. This study advances the supply chain decision making complemented with elements of TCE and DOI theory through the application of BCT. GSC managers can deploy BCT integrated with the Internet of Things to effectively meet worldwide supply chain demands and complex situations. [ABSTRACT FROM AUTHOR]

Outsourcing of public services is under heightened scrutiny. Public managers are asked to conduct thorough "make or buy" assessments to help assure deliverability, affordability, and value for money of public services. The naivety of this request dramatically overlooks the subtlety and challenge faced by public managers. In this paper we connect a range of differently configured contractual agreements to underlying components of "value for money", namely, the pursuit of economy, efficiency and effectiveness. We set out a framework consisting of conceptual models and the corresponding decision tree to allow comparison across alternative sourcing strategies, considering both the associated transaction costs and transaction benefits. We also use simulation methods to capture uncertainty while establishing the practicality of the framework. This study advocates for moving beyond the polarized 'make or buy' debate with more instrumental considerations of "how to buy" from the perspective of the public manager. [ABSTRACT FROM AUTHOR]

In the wake of technological innovation, supply chain transparency has become a concrete avenue for long-awaited improvements to supply chain processes and practices. Transparency is of particular interest to Supply Chain Finance; however, it is yet empirically unknown whether and how benefits would materialise. Being at the interface of finance and operations, Supply Chain Finance aims at improving the inter-company management of financial flows. Nowadays, different financing schemes are offered foremost by cooperation between financial institutions and fintechs. Uncertainty remains on whether and how supply chain transparency would benefit these schemes to allow the adoption of more sophisticated, higher-value schemes. By applying the Gioia method, we analysed a series of interviews with experts from the Supply Chain Finance industry regarding transaction cost economics, agency theory, and dynamic capability. The resulting series of pragmatic, theory-grounded but practice-inspired propositions untangle the relationship and barriers between supply chain transparency and Supply Chain Finance. The propositions provide advances in the theoretical understanding of Supply Chain Finance and uncover relevant directions for future research. This poses the base for actionable results in future research and leads to an impact in research by addressing the concerns and tensions raised by Supply Chain Finance experts. [ABSTRACT FROM AUTHOR]

In human services domains, policymakers mandate formal collaborations and alliances between public service agencies as part of policy implementation. We examine mandated child welfare collaborations in a stratified random sample of North Carolina counties, finding that agencies experienced frictions associated with collaboration fatigue and unclear goals. Access to private information, the ability to combine collaborations, and even serving lunch were conduits for successful collaboration. Agencies that did not engage faced high costs and saw little marginal benefit. We argue that policymakers looking to improve collaboration should communicate the value propositions to the agencies involved. They should also fund lunch. [ABSTRACT FROM AUTHOR]

This research brings together insights from the literature on the measurement of transaction costs related to agri-environmental schemes (AES) and formulates a conceptual framework for measuring these transaction costs. The framework is then applied to the Dutch AES in which farmer collectives act as a mediator between farmer-members and the Dutch government. In particular, we study the distribution of private transaction costs in the collective scheme and compare this to the distribution under the former individual approach. Results show that transaction costs have increased substantially for the collective, while they decreased for public actors. Moreover, the execution of the Dutch AES depends for a large part on volunteers, whose costs are not accounted for in official records. Although the Dutch AES appears successful in terms of coordination, we conclude that it carries substantial transaction costs for the collectives and its dependency on volunteers makes it fragile in the long term. [ABSTRACT FROM AUTHOR]

This essay re-examines the literature on the governance of interorganizational relationships, focusing on the insights of alliance research using transaction cost economics. Despite substantial progress, challenges arise because research has not devoted attention to some mechanisms of governance (i.e., administrative controls and supporting legal institutions) compared with others (i.e., incentives). Parties can develop bespoke collaborative agreements that mix and match various mechanisms of governance along these dimensions, rather than accessing a typical bundle commonly associated with a discrete organizational form. This conclusion challenges the iconic governance continuum and surfaces new methodological opportunities for this research stream. The essay also challenges what we think we know by identifying a variety of omitted variable problems that often crop up in governance research (e.g., focusing on the cooperative context of collaboration while not attending to the competitive context, excluding critical administrative structures when studying the interplay between contracts and trust, assuming transactional attributes are exogenous rather than endogenous to a search process, failing to account for shifting institutional supports for collaboration, etc.). By clarifying what we know and do not know about alliance governance, the essay identifies some pathways for developing more reliable, cumulative knowledge on interorganizational relationships. [ABSTRACT FROM AUTHOR]

In transitional economies, contract farming is widely recognized as a means for addressing numerous market failures affecting small farmers. Reviewing the scholarship on contract farming, we show that its traditional understandings have been framed by the narratives of transaction cost economics and power dynamics. We critically evaluate these narratives and demonstrate how stakeholder theory, with its relational understanding of business, offers a more comprehensive understanding of contract farming. We argue that a stakeholder theory perspective underscores the trust-based and collaborative nature of successful contract farming arrangements. It highlights the importance of informal and moral stakeholder relationships that compensate for the limitations of weak enforcement mechanisms and inadequate legal frameworks in transitional economies. This way, a stakeholder theory perspective on contract farming highlights its strategic management and business ethics dimensions, offering valuable guidance for cultivating successful stakeholder relationships. [ABSTRACT FROM AUTHOR]

Selecting a suitable project delivery method is one of the most critical decisions responsible for project success in heritage conservation. This is an area where projects have greater uncertainties and governance issues in comparison to other building projects. India has a huge inventory of built heritage sites, but the heritage conservation sector is highly fragmented, with a wide range of project delivery methods. This paper discusses the selection of project delivery in the Indian context, using the theoretical lenses of agency theory, transaction cost economics (TCE), and institution theory. A conceptual framework has been proposed to explain the selection based on economical and institutional constructs. Our conclusion is that when institutional factors are weak, projects are executed departmentally or through non-priced contracts. In contrast, strong institutional forces discourage non-priced contracts and replace them with priced contracts. [ABSTRACT FROM AUTHOR]

Agricultural commodity supply chains are characterised by the involvement of multiple intermediaries, lack of access to finance and poor financial conditions of farmers. Additionally, there exist numerous inefficiencies and a lack of transparency in the trading processes. Blockchain-enabled supply chain finance (SCF) solutions can potentially help to overcome these problems. However, there is limited research on the process of developing and implementing such solutions and the potential consequences of their implementation. In this paper, we apply the Context-Intervention-Mechanism-Outcome (CIMO) framework to systematically analyse case studies of four firms that have developed blockchain-enabled SCF solutions in agricultural commodity supply chains. The findings show that blockchain-enabled SCF solutions can reduce different types of transaction costs such as costs associated with information search, negotiation and contracting costs, and costs of accessing finance. The solutions designed with the core objective of improving the financial conditions of farmers will differ from those with the core objective of reducing process inefficiencies. The findings of the study will benefit companies planning to develop and implement blockchain-enabled SCF solutions, by highlighting operational challenges and offering concrete solutions on how they can be overcome. [ABSTRACT FROM AUTHOR]

The article aims to analyse the transaction costs of creating Shared Services Centres (SSC) as exemplified by two private companies and the Government Administration Support Centre (COAR). Within the framework of an approach based on transaction cost economics, two hypotheses were formulated: (1) the more resources a company possesses, the more the enterprise strives to utilise these resources by establishing an SSC, and (2) the higher the strategic value of assets, the more justified a company’s focus is on maintaining and utilising them internally, concentrating them within the SSC. The qualitative analysis conducted, including partially structured interviews and contracts with the analysed entities, validated both hypotheses. Within the SSC, key issues were identified, such as ensuring high-quality services and their continuous improvement, reducing opportunism, measuring service quality, valuing the effects of the implemented contract, and establishing efektyweffective communication within the given structure. The applied solutions were diverse, and the study showed a significant impact of three factors – processes, relational mechanisms, and organisational structure – which together affect both categories of transaction costs: management, related to the adaptive decision-making process, and measurement, concerning the impact of information.

It has been argued that the theory borrowing practices in IS research have become workmanlike— appropriate and effective, but lacking innovation. This concern is particularly salient at a time when digital phenomena are profoundly transforming society. Therefore, it is legitimate to ask: Are our theory borrowing practices hampering our ability to grapple with revolutionary developments in IS, and if so, what can be done? Through an investigation of the field’s borrowing of transaction cost economics theory, we find extant IS research largely (1) borrows for theory testing within the IS context, (2) develops models that uninspiringly reflect the borrowed theory, and (3) treats the IS as an exogenous actor. In this article, we propose an alternative approach to theory borrowing, inspired by conceptual blending theory. Our approach focuses on the structural nature of IS phenomena and borrowed theories. Such a structure-based approach can reveal correspondence between IS phenomena and unexpected reference theories while also highlighting discrepancies that serve as an opportunity for novel integrations of an information system into the reference theory. We contend that this approach can infuse flexibility into our theory borrowing practices in ways that will increase our capacity for developing innovative explanations of emerging phenomena. [ABSTRACT FROM AUTHOR]

Despite the growing importance of servitization as a source of competitiveness for manufacturers, limited knowledge exists about organizational issues of servitization. Drawing on transaction cost economics theory and a configuration theoretical perspective, our study illuminates different organization architectures for servitization and how firms align such architectures with servitization approaches to achieve high financial performance. We analyze qualitative data based on interviews with 22 managers and quantitative data from a survey of 161 equipment manufacturers. The results indicate that manufacturers mostly opt for one of three organization architectures for servitization: internal product business unit, internal specialized service business unit, or external service provider. In addition, they reveal equifinal configurations of servitization characteristics to achieve high financial performance for each organization architecture. The internal specialized service business unit turns out as a flexible organization architecture to successfully provide smoothing, adapting, and substituting services. The use of an external service provider is less suited for the provision of adapting and substituting services, which require more knowledge specialization and coordination. All three organization architectures can be used to provide smoothing services. In summary, the results may serve as decision-making templates for aligning organization architecture, offering characteristics, and service provider integration to pursue servitization successfully. [ABSTRACT FROM AUTHOR]

Although relationship commitment (RC) is the foundation for inter-firm information sharing (IS) activities, extant studies have only discussed the influence of normative RC on IS but ignored the impact of instrumental RC and the moderators that affect these relationships. Combining transaction cost economics (TCE) and social exchange theory (SET), this study probes the impacts of normative RC and instrumental RC on IS content and IS system between manufacturers and suppliers and investigates the moderating effects of environmental uncertainty (EUN) on these relationships. Using the data collected from 410 Chinese manufacturers, this research finds that normative RC promotes IS content and IS system, but instrumental RC generates non-significant impacts on them. However, these effects significantly change when the business environment becomes more uncertain, demonstrating the necessity to consider EUN as the moderator. Besides, supplier IS content and IS system improve service performance and IS system increases IS content. [ABSTRACT FROM AUTHOR]

Public-Private Partnerships (PPPs) have emerged as a pivotal strategy for fostering sustainable economic development, particularly in underdeveloped regions. This article delves into the mechanisms of PPPs, their historical evolution, and their theoretical underpinnings. Through a detailed analysis of case studies from various underdeveloped regions, this study examines the effectiveness of PPPs in addressing infrastructure deficits, enhancing public services, and promoting economic growth. The findings underscore the critical role of government policies, institutional frameworks, and stakeholder engagement in the success of PPPs. The article concludes with policy recommendations aimed at optimizing the deployment of PPPs to achieve sustainable economic development in underdeveloped regions. [ABSTRACT FROM AUTHOR]

Venture studios present an intriguing proposition for entrepreneurship theory – a shift from venturing as an entrepreneur-driven activity to venturing as an "assembly line" serialization in an organization. We ask the question whether between-venture studio differences explain the differences in outcomes among the ventures they create. We hypothesize that venture studios explain meaningful variance in explaining venture outcomes. Our empirical study is based on a sample of 350 venture studios from 34 countries, 257 industries, and startup-founding years, ranging from 1994 to 2022. We focus on the sales, employees, and whether the venture was acquired or went IPO. Using variance decomposition analysis, we find that differences in venture studios explain most of the variance in differences in venture outcomes (~30%), with low teens to single-digit variances explained by studio-founding year, venture founding year, country, and industry effects. To our knowledge, this is the largest and most comprehensive empirical study of venture studios to date, and variance decomposition analysis presents an important first step to assessing whether the unique resources and the transaction cost benefits afforded by venture studios explain differences in performance between ventures. [ABSTRACT FROM AUTHOR]

The transaction cost economics framework has been used for more than three decades to explain how firms transact and organize in hierarchies and markets. However, when market innovations and societal changes occur, organizing theories should be updated to reflect the novel aspects of the environment. In this paper, we leverage recent technology and social innovations as a catalyst for synthesizing and extending transaction cost theory. Venture funding transactions today only vaguely resemble funding transactions from decades past. Yet, scholars still frequently rely on theoretical tenets that were established before the advent of the internet to explain funding transactions. In this research, we codify venture-funding modalities along a continuum from more market-esque to more hierarchical and develop funding transaction propositions for the new funding context. [ABSTRACT FROM AUTHOR]

Stakeholder scholars have long explored how stakeholder relationships differ from economic transactions. We contribute to this ongoing inquiry by developing a conceptual framework of relationality in stakeholder theory that encompasses a stakeholder‐theoretic extension of Williamson's contracting schema and a new typology of stakeholder relationships. Premised on understanding relationality as the need for informal human relationships beyond formal governance, our framework locates the key difference between transaction cost economics and stakeholder theory in their treatment of informal relationships. While transaction cost economics perceives informal relationships to be shaped by formal governance structures and enforced by contractual safeguards, stakeholder theory is open to the possibility that some informal relationships between stakeholders may be genuinely moral and thus irreducible to formal governance and contractual safeguards. These stakeholder relationships may lead to unique economic effects described by instrumental stakeholder theory. The difference that we identified between the two literatures shows how stakeholder theory's embrace of relationality surpasses that of transaction cost economics. [ABSTRACT FROM AUTHOR]

In this paper, we seek to break new ground by empirically investigating the relationship between cooperating entities, local government institutions and transaction costs and its effect on cost efficiency for water services through consortia in Brazilian local government. Drawing on an institutional and transaction cost framework, our results show that the institutional arrangements employed in water service provision have had a significant effect on cost efficiency, measured by total expenditure per user, between 2011 to 2019. Through a Generalized Estimating Equations (GEE), we found that cost efficiency increases slowly for those units performing under bureaucracies and faster under public enterprises. In all instances, dedicated asset specificities and contract management complexity explained differences in water service provision cost efficiency. These findings have theoretical significance as well as significant public policy implications for intermunicipal cooperative agreements. [ABSTRACT FROM AUTHOR]

This paper examines the relationship between enterprise systems (ES) and the likelihood of mergers and acquisitions (M&A). The key argument is that since ES can reduce agency costs associated with internal coordination and the transaction cost of coordinating with external partners, ES may be related to the likelihood of M&A. Using a sample of 3,289 firms headquartered in North America from 2010 to 2018 that made 8,373 M&A deals, the empirical analysis suggests that ES are positively related to horizontal acquisitions and negatively related to conglomerate acquisitions. However, as internal coordination costs increase, ES are becoming associated with more conglomerate M&A, especially when the goal is to introduce new products and enter new markets. Also, in contexts where partners require transactionspecific investments, ES are associated with a relative decrease in the number of horizontal and vertical M&A. These findings suggest that ES create options for managers to engage in ownership as well as information-based coordination, depending on the internal and external coordination costs as well as the goals of the organization. [ABSTRACT FROM AUTHOR]

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Research Summary: We analyze how the evolution of the broad institutional environment influences the vertical integration strategy of a multinational corporation (MNC) leading a global value chain (GVC). We develop a history‐to‐theory study based on the evolution of the banana GVC between 1899 and 1991. We argue that when a MNC's bargaining power vis‐à‐vis the host government is strong, it will choose a governance structure that addresses contractual uncertainty. When the MNC's bargaining power declines because of changes in the institutional environment, it will prioritize a governance structure that protects its assets. We analyze the evolution of MNC's bargaining power as a result of the interaction of three levels of the institutional environment: global, home country, and host country. Managerial Summary: Our study examines vertical integration decisions in a global value chain (GVC) throughout its historical evolution. Using historical sources, we show that when MNC managers perceive their bargaining power to be sufficient to protect them from hostile government actions in host countries, their main concern is that of governing their activities as efficiently as possible by amongst others vertically integrating asset‐specific transactions. When their bargaining power declines, MNCs become more concerned with shielding their assets and rents from expropriations by host‐country governments, thus retreating from vertical integration. We illustrate that the bargaining power of MNCs changes as events at the global, home, and host country levels unfold. For example, MNCs' bargaining power declines in periods featuring economic nationalism, such as the 1960s–1970s. [ABSTRACT FROM AUTHOR]

Abstract Formal written land leasing contracts offer an alternative to land purchase for those farmers wishing to expand their land area and provide greater security relative to informal short-term rental agreements and are particularly important for beginning farmers with resources insufficient to purchase land. Formal land leasing contracts vary in terms of their duration, but there is limited understanding about the determinants of contract duration in developed countries. In this research, we use econometric techniques and transaction level data to explore the determinants of duration for agricultural land lease contracts for two regions in Ireland. Under the transaction cost economics approach, the research explores the role of legal status, price and non-price conditions in influencing the contract duration. Results indicate that the legal status of the tenant is a significant factor in influencing the duration. Provisions such as break clauses appear positively related to duration and confirm the theoretical expectation that long-term contracts create a demand for processes that enable adaptation over the course of long-term exchange.

With the emergence of distributed ledger technology (DLT), numerous practitioners and researchers have proclaimed its beneficial impact on supply chain transactions in the future. However, the vast majority of DLT initiatives are discontinued after a short period. With the full potential of DLT laying far down the road, especially managers in supply chain management (SCM) seek for short-term cost-saving effects of DLT in order to achieve long-term benefits of DLT in the future. However, the extant research has bypassed grounding long-term as well as short-term effects of DLT on supply chain transaction with empirical data. We address this shortcoming, following an abductive research approach and combining empirical data from a multiple case study design with the corresponding literature. Our study reveals that the effects of DLT on supply chain transactions are two-sided. We found six effects of DLT solutions that have a cost-reducing or cost avoidance impact on supply chain transactions. In addition, we found two effects that change the power distribution between buyers and suppliers in transactions and a single effect that reduces the dependency of supply chain transactions on third parties. While cost-reducing and avoidance as well as dependency-reducing effects are positive effects, the change in power distribution might come with disadvantages. With these findings, the paper provides the first empirical evidence of the impact of DLT on supply chain transactions, which will enable managers to improve their assessment of DLT usage in supply chains. [ABSTRACT FROM AUTHOR]

Environmental collaboration between organizations involved in construction projects enables the efficiency of environmental management to gain environmental sustainability. Yet, in many projects, this collaboration is gamed promoting contractor greenwashing behavior, thereby diminishing the effectiveness of environmental management. What is unclear are the underpinning mechanisms to concurrently increase environmental collaboration and decrease contractor greenwashing behavior in construction projects. We used an integrated theoretical framework based on social exchange theory and transaction cost economics to evaluate the potential linear, curvilinear, and combined influence of interorganizational trust and formal contracts on environmental collaboration and contractor greenwashing behavior. Drawing evidence from questionnaire surveys, we find that two categories of interorganizational trust yield positive impacts on environmental collaboration and different curvilinear impacts on greenwashing behavior. Two categories of formal contracts exert an inverted U-shaped effect on environmental collaboration and heterogeneous effects on greenwashing behavior. We also find that formal contracts negatively moderate the effects of interorganizational trust on environmental collaboration, and interorganizational trust negatively moderates the impact of formal contracts on greenwashing. We provide novel insights into the interorganizational governance mechanisms regarding greenwashing in construction projects relevant for construction managers concerned with the environmental efficiency-effectiveness. [ABSTRACT FROM AUTHOR]

Globalisation in the late--nineteenth century was driven by expansion of global commodity trades. These processes are predominantly explained as the result of changes in technology and policy. Less attention is paid to the trading companies undertaking these activities. To understand their importance in global trade this article examines their role in the significant Anglo-Indian indigo trade. It reveals they innovated their organisation and structure of the trade to lower a range of transaction costs and improve market coordination, leading to an expansion in the trade. Explanations of globalisation can be improved by accounting for the evolving role of trading companies. [ABSTRACT FROM AUTHOR]

The article deals with the rubber boom at the beginning of the 20th century, which fundamentally changed the global rubber market. Trading companies played a crucial role in this development, connecting the areas of production with centres of commerce and with places of industrial usage of rubber. The article follows the transformation from a wild rubber to a plantation rubber industry by using a global commodity chain approach to compare the function and position of German and British firms in the global rubber market. It combines the chain analysis with the theory of transaction costs to discuss the strategies of trading firms in these changing environments of globalisation. The article reveals that transaction cost explains only a part of the transformation, while institutional settings played a major role for the strategy of trading firms. [ABSTRACT FROM AUTHOR]

Abstract This study investigates what factors relate to the coffee farmer’s cooperative affiliation decision and whether this decision impacts the farmer’s cash holdings. First, we propose a cooperative affiliation model based on transaction cost economics theory. There is a lack of consensus in the literature on what factors explain the farmer’s cooperative affiliation decision in the coffee sector. Overall, we find that the more specialized coffee farmers are, the more likely they will become cooperative affiliates. This is consistent with transaction cost economics predicting that cooperatives are business structures that can reduce transaction costs and safeguard specialized assets from opportunistic behavior. Specifically, logit regression models suggest that shade-grown coffee plantations, off-farm income, coffee farming experience, low-level market competition, farmland size, altitude, and private farmland are statistically related to the farmer’s decision to affiliate with cooperatives. Results on farmland size and shade-grown coffee plantations can be particularly relevant for scholars, policymakers, cooperative leaders, and extension professionals in the region. Second, based on the affiliation model, we employ propensity score matching to evaluate the impact of the farmer’s cooperative affiliation decision on cash holdings, particularly on cash shortness. It is often claimed that farmers do not affiliate with cooperatives because these organizations cannot pay them in full at harvest and coffee collection time. It is believed that cooperatives’ inability to pay farmers early increases the likelihood of farmers’ cash shortness and their need for additional financing to operate or cover household needs. However, this study finds no evidence that the affiliation decision is related to the likelihood of the farmer experiencing cash shortness around harvesting and selling time.

Previous research has shown that implementing blockchain technology in businesses can lead to more secure and efficient processes in various organizational areas, including human resource management. This review paper examines the use of blockchain in human resources departments from the perspective of transaction cost economics theory, which identifies several fundamental variables that increase transaction costs for firms. These variables include bounded rationality, the pervasive possibility of opportunistic behavior, and uncertainty. The paper explores how blockchain implementation, including blockchain-enabled smart contracts, can mitigate these challenges. The paper also identifies some limitations to using blockchain and smart contracts that may increase transaction costs and thus reduce transaction cost savings.

The central premise of transaction cost economics (TCE) is that parties select governance mechanisms to mitigate the hazards of opportunism (or "behavioral uncertainty") while also economizing on the costs of more complex forms of governance. However, boundedly rational actors face meaningful limitations on their foresight which constrains their ability to negotiate complete contractual terms. TCE largely treats contractual incompleteness as a problem that parties eliminate whenever cost considerations allow. The theory developed here argues that under certain conditions, mutual legal uncertainty serves as a commitment strategy that enables contracting parties to ensure shared dependence and forbearance within their transactional relationship. Parties that employ this commitment strategy mutually accept the risk of an unfavorable outcome based upon an interpretation of the incomplete language imposed through the judicial enforcement mechanism. Thus, contractual incompleteness constitutes a shared commitment to both avoid judicial enforcement and adapt the relationship to unforeseen or unlikely future events. [ABSTRACT FROM AUTHOR]

Purpose: This study aims to understand the mechanisms of property rights guarantee in the dairy agro-industrial system (DAGS) in Paraná, Brazil, and in the old Midi-Pyrénées region, France. Originality/value: From a complementary perspective of Transaction Cost Theory and Measurement Cost Theory, the proposal in the study is that the use of mechanisms to guarantee property rights through safeguards, parameters, measurement, agreements, or litigation contributes to the transaction of differentiated products and also to the protection of these rights, favoring systems improvement. Design/method/approach: A descriptive qualitative study was done, encompassing 25 semi-structured interviews with producers, processors, and key agents of the DAGS in the state of Paraná in Brazil and in the old Midi-Pyrénées region of France, in 2016 and 2017. Quali tative content analysis was performed with NVivo Pro software. Findings: It was identified that in France and in the central-eastern and western regions of Paraná, the use of complementary protection property rights mechanisms (safeguards, parameters, measurement, agreements, or litigation) allows higher quality milk transactions and reinvestments in production by agents, contributing to system improvement. In the northern region of Paraná, the limited use of property rights mechanisms (verbal agreement, measurement, unreliable information sharing, and the absence of ex post protection) allows minimal quality milk tran - s actions and restricts reinvestments in production, limiting systems improvement. [ABSTRACT FROM AUTHOR]

A large proportion of inter-firm relationships (IFRs) in the outsourcing industry fail globally to achieve their intended objectives. As such, the right management controls are required in order to support these relationships. There is however, limited empirical research on effective inter-firm (buyer-supplier) relationships (EIFRs) and management controls for specific industries. This study extends the literature by examining EIFRs and their relevant management controls in the ready-made garments (RMG) industry in Bangladesh. The RMG industry in Bangladesh is highly dependent on international buyers as they contribute significantly to the country’s economy. Thus, the purpose of this study is to examine the relevant management control models to support EFIFs in the RMG industry. Accordingly, a cross-sectional survey was conducted with senior managers of RMG suppliers in Dhaka City. The results highlight the importance of market-based and trust-based control models in supporting EIFRs in Bangladesh’s RMG industry. [ABSTRACT FROM AUTHOR]

Formal written land leasing contracts offer an alternative to land purchase for those farmers wishing to expand their land area and provide greater security relative to informal short-term rental agreements and are particularly important for beginning farmers with resources insufficient to purchase land. Formal land leasing contracts vary in terms of their duration, but there is limited understanding about the determinants of contract duration in developed countries. In this research, we use econometric techniques and transaction level data to explore the determinants of duration for agricultural land lease contracts for two regions in Ireland. Under the transaction cost economics approach, the research explores the role of legal status, price and non-price conditions in influencing the contract duration. Results indicate that the legal status of the tenant is a significant factor in influencing the duration. Provisions such as break clauses appear positively related to duration and confirm the theoretical expectation that long-term contracts create a demand for processes that enable adaptation over the course of long-term exchange. [ABSTRACT FROM AUTHOR]

This paper examines the question of whether computer code could actually substitute for intermediaries, as proponents of distributed ledger technology (DLT) and decentralised finance would argue. Drawing on transaction-cost economics, the paper reviews the role of intermediaries as efficient platforms for the exchange of information, goods and payments. The generic advantage of centralised coordination is compared with the narrative that DLT and decentralised finance could substitute for intermediaries due to their efficiency advantages and the promise of lower costs. The positivist question 'cui bono?' can be applied as a litmus test of these normative narratives in comparison with existing systems. As proposed concepts 'without' intermediaries introduce other intermediaries by the backdoor and no system runs without transaction costs of some sort, the paper concludes that intermediaries cannot be simply replaced. [ABSTRACT FROM AUTHOR]