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Ex Post Problems in Buyer–Supplier Transactions: Effects of Transaction Characteristics, Social Embeddedness, and Contractual Governance

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Author Info
Gerrit Rooks
Werner Raub ()
Frits Tazelaar
Abstract

This paper focuses on ex post governance of inter-firm transactions. We develop and test hypotheses on the occurrence of ex post problems like delivery delays, inferior quality, and insufficient service in buyer–supplier transactions. Our hypotheses address effects of transaction characteristics, of social embeddedness, and of contractual governance on the occurrence of problems. Other than earlier research on embeddedness effects in this field, we consider not only effects of dyadic embeddedness but also effects of network embeddedness. We test hypotheses using rich survey data on more than 1200 purchases of information technology (IT) products: hardware and software, both standard and complex. We find evidence for effects of transaction characteristics on the occurrence of problems, while our data do not support hypotheses on effects of contractual governance. Our data provide rather consistent support for hypotheses on the effects of embeddedness. Specifically, we find evidence that network embeddedness reduces problems. Copyright Springer Science+Business Media, Inc. 2006

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File URL: http://hdl.handle.net/10.1007/s10997-006-9000-7
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Publisher Info
Article provided by Springer in its journal Journal of Management & Governance.

Volume (Year): 10 (2006)
Issue (Month): 3 (September)
Pages: 239-276
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Handle: RePEc:kap:jmgtgv:v:10:y:2006:i:3:p:239-276

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Web page: http://www.springerlink.com/link.asp?id=102940

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Related research
Keywords: buyer–supplier relations; embeddedness; ex post problems; inter-firm networks; governance; transaction cost theory;

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Szroeter, Jerzy, 1978. "A Class of Parametric Tests for Heteroscedasticity in Linear Econometric Models X1-ab," Econometrica, Econometric Society, vol. 46(6), pages 1311-27, November. [Downloadable!] (restricted)
  2. Shelanski, Howard A & Klein, Peter G, 1995. "Empirical Research in Transaction Cost Economics: A Review and Assessment," Journal of Law, Economics and Organization, Oxford University Press, vol. 11(2), pages 335-61, October.
  3. Canice Prendergast, 1999. "The Provision of Incentives in Firms," Journal of Economic Literature, American Economic Association, vol. 37(1), pages 7-63, March. [Downloadable!] (restricted)
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