Heterogeneity of plural forms: a revised transaction cost approach

Schnaider, Paula Sarita Bigio

doi:10.11606/t.12.2016.tde-07032016-092021

Cited by 6 publications

(23 citation statements)

References 72 publications

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“…Recent papers extend the standard TCE explanation to account for plural forms (Krzeminska, ; Menard, ; Schnaider et al ., ). The idea underlying these contributions is the following.…”

Section: Drivers Of Plural Formsmentioning

confidence: 97%

“…Another direction to integrate plural forms in the TCE framework is to consider the interplay between various transactional attributes (Parmigiani, ; Schnaider et al ., ). As Williamson () himself argues, the interactive effects of asset specificity and uncertainty are of fundamental relevance for a proper understanding of the economic organization of production.…”

Section: Drivers Of Plural Formsmentioning

confidence: 97%

“…In that spirit, Krzeminska () and Schnaider et al . () develop extensions to the TCE theory by integrating those two variables to predict under which circumstances one should expect plural or nonplural arrangements to organize a given transaction (or set of transactions). Roughly, the framework predicts the prevalence of plural forms when there are intermediate levels of asset specificity involved in a given transaction and quite significant levels of uncertainty affecting this same transaction (uncertainty is a matter of little consequence when asset specificity is very low – because agents can be easily replaced – or very high – vertical integration is the only feasible solution).…”

Section: Drivers Of Plural Formsmentioning

confidence: 99%

“…Moreover, Schnaider et al . () even propose that not only does the level of uncertainty matter to explain the persistence of plural forms, but also, its qualification. Hence, the authors group the sources of uncertainty into three broad categories, which might affect transactions in isolation or combined, depending on the industry and conditions under which each firm will operate: market uncertainty (uncertainty about the conditions of supply and demand); technological uncertainty (uncertainty about the best technology or about the possibility of obsolescence); and, finally, performance assessment uncertainty (roughly behavioral uncertainty).…”

Section: Drivers Of Plural Formsmentioning

confidence: 99%

See 3 more Smart Citations

Surveying the Economics of Plural Modes of Organization

Raynaud

Schnaider

Saes

2019

Journal of Economic Surveys

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Why do firms concomitantly rely on more than one organizational arrangement to procure/distribute a given input/product? In this paper, we systematically review and discuss the extensive path undergone by the literature exploring this issue: the so‐called plural forms. We address two main questions: how to explain the coexistence (and often the prevalence) of plural forms in many types of businesses? Are plural forms stable or a transitory phenomenon? We describe the most prominent motivations identified in the economics and management literature that drive firms to adopt plural forms and show that their vast majority are related to the mitigation of various types of agency/transaction costs. We also demonstrate that most of the available pieces of empirical evidence suggest the stability of plural forms over time. We conclude by demonstrating the path that has been trailed by the most recent developments.

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“…Recent papers extend the standard TCE explanation to account for plural forms (Krzeminska, ; Menard, ; Schnaider et al ., ). The idea underlying these contributions is the following.…”

Section: Drivers Of Plural Formsmentioning

confidence: 97%

Section: Drivers Of Plural Formsmentioning

confidence: 97%

Section: Drivers Of Plural Formsmentioning

confidence: 99%

Section: Drivers Of Plural Formsmentioning

confidence: 99%

See 2 more Smart Citations

Surveying the Economics of Plural Modes of Organization

Raynaud

Schnaider

Saes

2019

Journal of Economic Surveys

Self Cite

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“…Hence, other dimensions, such as performance uncertainty and technological uncertainty are not included in this measure. Future research should improve the operationalization of the uncertainty construct by including additional dimensions, such as demand uncertainty, performance uncertainty, and technological uncertainty (e.g., Parmigiani 2007;Schnaider, M enard, and Saes 2018;Ju et al 2019), Second, this study explains the ownership structure of franchise chains based on the IPVO, which primarily focuses on adaptation and control costs due to the information processing effects of the governance structure under bounded rationality of network partners. Franchised outlets have local information acquisition advantages, whereas company-owned outlets have coordination and control advantages.…”

Section: Limitationsmentioning

confidence: 99%

Ownership Structure of Franchise Chains: Trade-Off Between Adaptation and Control

Glaser

Jirásek

Windsperger

2020

International Journal of the Economics of Business

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This study provides a new explanation of the ownership structure of franchise firms by highlighting a trade-off between adaptation and control under increasing uncertainty. Franchise chains are formed to reduce transaction costs by combining franchisee outlets as an adaptation mechanism and company-owned outlets as a control mechanism. We argue that under low to moderate uncertainty, franchisors prioritize local responsiveness to profit opportunities by operating a lower proportion of company-owned outlets (PCO); by contrast, under high environmental uncertainty, franchisors prefer more central control through a higher PCO to coordinate interdependent local market outlets better. Hence, the franchisor must find an optimal PCO by balancing the PCO decreasing effect of higher local adaptation with the PCO increasing effect of higher central coordination under increasing uncertainty. Therefore, we posit a U-shaped relationship between the PCO and environmental uncertainty. Data from German and Swiss franchise systems provide support for the study's hypotheses.

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Plural forms and differentiation strategies in the agri‐food sector: Evidence from the U.S. wine industry

et al. 2022

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This article investigates how measurement ability, trust, and the pursuit of differentiation strategies influence the adoption of plural forms in an agri-food system. We analyze a unique dataset of 314 winegrape sourcing choices from 74 wineries located in five U.S. states, investigating how the pursuit of differentiation influences the likelihood of adoption of a plural form-that is, the simultaneous adoption of a formal arrangement (i.e., vertical integration or long-term formal contract) and an informal arrangement (i.e., informal contracts or spot-market transactions).Consistent with previous studies, measurement ability and the existence of trust are both associated with a higher likelihood of adoption of informal arrangements in comparison to formal arrangements. Moreover, we show that the likelihood of adoption of a plural form increases as the differentiation potential of a winegrape variety also increases. Finally, we find that the use of plural forms is associated with a reduction in the importance of trust in the relationships with external suppliers. This study is important because it sheds light on the role of plural forms in the pursuit of competitive advantage in an agri-food system. Overall, it suggests that the current interpretations

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Heterogeneity of plural forms: a revised transaction cost approach

Cited by 6 publications

References 72 publications

Surveying the Economics of Plural Modes of Organization

Surveying the Economics of Plural Modes of Organization

Ownership Structure of Franchise Chains: Trade-Off Between Adaptation and Control

Plural forms and differentiation strategies in the agri‐food sector: Evidence from the U.S. wine industry

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