This chapter addresses the relationship between a supplier and the manufacturers that it serves, from the perspective of transaction cost economics theory (TCE). TCE deals with relationships between organizations, such as customers, manufacturers and suppliers. It states that investment in transaction-specific assets opens the door for opportunistic behavior by an organization’s partners. Inter...

This paper introduces the theory and method of Transaction Cost Economics to identify the essence of e-commerce model by explicating its core objective and function. From the correspondence of transactions and governance structures, the author also discusses the design principle of an ecommerce model. The analysis shows that so-called e-commerce model in commercial practice could be identified ...

Transaction cost economics is an economizing theory of organization, not an economizing theory of strategy. This paper proposes an extension that makes transaction cost economics (TCE) an economizing theory of strategy. In essence, the paper asserts that unbiased weighing of production costs, transaction costs, and demand shifts links the organization of individual transactions to the strategy ...

IS discipline has witnessed significant growth in research on IT inand out-sourcing. Economic theories inform a large portion of this work. This paper examines the use of Transaction Cost Economics (TCE) as a theoretical lens to study IT sourcing decisions (internal vs. external). It reviews TCE’s major assumptions and assesses its key constructs: frequency, asset specificity, opportunism, an...

IS discipline has seen a large and growing body of research on IT sourcing, with economic theories informing a large portion of this work. The paper examines use of Transaction Cost Economics (TCE) as a theoretical lens to study IT sourcing decision (internal vs. external). It reviews TCE’s major assumptions, and assesses key constructs of frequency, asset specificity, opportunism, and uncertai...

NetSourcing has recently gained some importance in the IS literature. However, although the customer side of Netsourcing has drawn a lot of interest, its supply-side remains under-researched. One of the challenges faced by Netsourcing vendors is the difficulty in sourcing the components of the infrastructure on which they rely. This paper proposes to investigate the sourcing strategies used by ...

This paper considers how competition can affect aggregate innovative activity through its effects on firms’ decision whether or not to vertically integrate. A moderate increase in competition enhances innovation incentives, too much competition discourages innovative effort. These effects generates an inverted-U relationship between competition and innovation and between competition and the inc...

This article sets out a framework for the analysis of corporate governance and international business. We take a broad perspective on corporate governance mechanisms and consider possible synergies between corporate governance and international business (IB) research. We summarize the papers included in this Focused Issue, and draw out their main contributions to the literature. We compare and ...