Research and Development Alliances: Evidence from a Federal Contracts Repository

Ciccotello, Conrad S.; Hornyak, Martin J.; Piwowar, Michael S.

doi:10.1086/378696

Cited by 9 publications

(5 citation statements)

References 37 publications

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“…As transactional attributes increase, so too does the risk that exchange hazards will undermine exchange performance. To avert or minimize such transaction costs, managers (a) add contractual provisions that explicate rules and processes for resolving disagreements and addressing unexpected events (Hagedoorn & Hesen, 2007; Poppo & Zenger, 2002; Reuer & Ariño, 2007; Zhou, Poppo, & Yang, 2008); (b) increase the duration of the contract to recover, for example, asset-specific investments (Ciccotello, Hornyak, & Piwowar, 2004; Joskow, 1988); (c) create economic bonds or hostages, which tie parties to each other (Anderson & Weitz, 1992; Srinivasan & Brush, 2006); and (d) undertake equity investments (e.g., Helm & Kloyer, 2004). More thorough reviews of this literature are available (see David & Han, 2004; Furlotti, 2007; Lajili et al, 2007; Macher & Richman, 2008; Masten & Saussier, 2000).…”

Section: Perspectives Informing Contract Structure: Tce Relational and Firm Capabilities And Real Optionsmentioning

confidence: 99%

The Many Futures of Contracts

Schepker

Martynov

et al. 2013

Journal of Management

327

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In this article, we review the literature on interfirm contracting in an effort to synthesize existing research and direct future scholarship. While transaction cost economics (TCE) is the most prominent perspective informing the “optimal governance” and “safeguarding” function of contracts, our review indicates other perspectives are necessary to understand how contracts are structured: relational capabilities (i.e., building cooperation, creating trust), firm capabilities, relational contracts, and the real option value of a contract. Our review also indicates that contract research is moving away from a narrow focus on contract structure and its safeguarding function toward a broader focus that also highlights adaptation and coordination. We end by noting the following research gaps: consequences of contracting, specifically outcome assessment; strategic options, decision rights, and the evolution of dynamic capabilities; contextual constraints of relational capabilities; contextual constraints of contracting capabilities; complements, substitutes, and bundles; and contract structure and social process.

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Section: Perspectives Informing Contract Structure: Tce Relational and Firm Capabilities And Real Optionsmentioning

confidence: 99%

The Many Futures of Contracts

Schepker

Martynov

et al. 2013

Journal of Management

327

View full text Add to dashboard Cite

show abstract

“…In recent years, an empirical investigation of contract term was performed by Ciccotello, et al (2004). The authors argue that while previous research has found long-term contracting to be an efficient response to hold up risks associated with investment in transaction-specific tangible capital, the same thing should also be true when the investment involved is in intangible capital (human capital).…”

Section: Contract Durationmentioning

confidence: 99%

There is more to contracts than incompleteness: a review and assessment of empirical research on inter-firm contract design

Furlotti

2007

J Manage Governance

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This paper aims at achieving a greater understanding of how contracts operate in practice through a review of recent empirical literature on inter-firm contract design. Our focus on the structure of contractual agreements differentiates this review from others that dedicated ample coverage also to the antecedents of the decision to contract and of the choice of contracting versus integration. Our framework develops Stinchcombe’s (Organization Theory and Project Management, 1985) hypothesis that contracts are an organizational phenomenon. This allows us to uncover considerable but unevenly distributed evidence on a number of organizational processes formalized in relational contracts, which partially overlap with the processes that are observed in integrated organizations. It also enables us to describe contracts in terms of a larger number of dimensions than is commonly appreciated. The paper summarizes the evidence by proposing a general and tentative framework to guide the design of relational contracts, discusses a number of lingering issues, and outlines directions for further research on contracts as an organizational phenomenon. Copyright Springer Science+Business Media, LLC 2007Contracts, Governance, Inter-organizational research, Alliances, Literature review,

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“…Franchise contract design plays an important role in encouraging interaction between the franchisors and franchisees: the more training is required to replicate the franchise concept, the longer is the franchise contract. Previous research in the context of R&D agreements shows that the sharing of more tacit technology necessitates longer contracts (Ciccotello et al, 2004). Hence, I have the hypothesis:…”

Section: Resource-based Theorymentioning

confidence: 93%

Determinants, transactional alignment, and performance outcomes of franchise contract length

Gorovaia

2018

IJRDM

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Purpose The purpose of this paper is to explore the determinants, transactional alignment and performance outcomes of franchise contract length using transaction costs theory (TCT) and resource-based theory (RBT). Design/methodology/approach The author hypothesizes that franchisors choose contract length according to TCT and RBT arguments. TCT explains the safeguarding function of contracts: the franchisors will offer longer contracts when franchisees’ specific investments are high and environmental uncertainty is low. RBT highlights the knowledge leverage function of contracts: the franchisors will offer longer contracts when the brand name and intangible knowledge assets are high. Franchise companies that design contract length aligned with transactional attributes will perform better. The author tests the misalignment hypothesis and comparative performance of franchise contracts by estimating two-stage least squares regression and Heckman two-stage procedure that control for endogeneity and self-selection. Findings Empirical data from the German franchise sector support the hypotheses. In addition to the safeguarding function, franchise contracts have an important knowledge leverage function. Longer contracts perform better due to the development of relational strategic assets and stronger commitment. Research limitations/implications Franchisors must offer longer contracts when specific investments of franchisees, brand name, intangible knowledge assets are high, and environmental uncertainty is low. Franchisors should invest in the development of relational strategic assets and offer longer contracts for the benefit of superior performance. Originality/value The study addresses the significant question of transactional alignment and comparative performance of franchise contracts. It empirically confirms the importance of RBT in explaining contractual choices and performance.

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Research and Development Alliances: Evidence from a Federal Contracts Repository

Cited by 9 publications

References 37 publications

The Many Futures of Contracts

The Many Futures of Contracts

There is more to contracts than incompleteness: a review and assessment of empirical research on inter-firm contract design

Determinants, transactional alignment, and performance outcomes of franchise contract length

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