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Product Complementarities, Capabilities and Governance: A Dynamic Transaction Cost Perspective

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  • Spiller, Pablo T
  • Zelner, Bennet A

Abstract

The organization and governance of the transactions that comprise a bundling arrangement depend on the distribution of capabilities among firms and the amount of time during which the window of opportunity for earning rents is expected to remain open. Firms engaged in inter-firm collaboration must undertake 'support' transactions related to billing, marketing customer support and product repair. These support transactions differ from the 'core' transactions that have traditionally been perceived as sufficient to provide a product bundle. Since support transactions create costs of their own, the market may turn out to be an expensive means of governing collaborative arrangements undertaken for bundling purposes. The telecommunications service sector provides an illustration. Copyright 1997 by Oxford University Press.

Suggested Citation

  • Spiller, Pablo T & Zelner, Bennet A, 1997. "Product Complementarities, Capabilities and Governance: A Dynamic Transaction Cost Perspective," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 6(3), pages 561-594, September.
  • Handle: RePEc:oup:indcch:v:6:y:1997:i:3:p:561-94
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    Cited by:

    1. Oana Madalina Popescu & Stelian Stancu & Alina Neamtu Idorasi & Paul Marinescu, 2019. "Customer solutions – new sources of sustainable competitive advantage in times of global economic crisis," Manager Journal, Faculty of Business and Administration, University of Bucharest, vol. 30(1), pages 7-30, December.
    2. Plananska, Jana & Gamma, Karoline, 2022. "Product bundling for accelerating electric vehicle adoption: A mixed-method empirical analysis of Swiss customers," Renewable and Sustainable Energy Reviews, Elsevier, vol. 154(C).
    3. Kim, Joon Ho & Kang, Kyung Ho, 2018. "The effect of promotion on gaming revenue: A study of the US casino industry," Tourism Management, Elsevier, vol. 65(C), pages 317-326.
    4. Barry Nalebuff, 1999. "Bundling," Yale School of Management Working Papers ysm126, Yale School of Management, revised 01 Dec 2000.
    5. Alina Neamtu (Idorasi) & Stelian Stancu & Gheorghe Hurduzeu, 2020. "Creating Effective Customer Solutions – a Global Perspective," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 23(75), pages 38-69, March.
    6. Maze, Armelle, 2002. "Learning Process and Contract Adaptation with Quality Uncertainty: Some Paradoxes in Retailer-Producer Relationships," 2002 International Congress, August 28-31, 2002, Zaragoza, Spain 24957, European Association of Agricultural Economists.
    7. Alina Neamtu Idorasi & Stelian Stancu & Oana Madalina Popescu & Ionut Constantin, 2019. "The customer perspective – an effective and efficient way to differentiate for companies in the globalization era," Manager Journal, Faculty of Business and Administration, University of Bucharest, vol. 30(1), pages 31-51, December.
    8. Ricard Gil & Pablo T. Spiller, 2007. "The Organizational Implications of Creativity: The US Film Industry in Mid-XXth Century," NBER Working Papers 13253, National Bureau of Economic Research, Inc.
    9. Manral, Lalit & Harrigan, Kathryn R., 2018. "The logic of demand-side diversification: Evidence from the US telecommunications sector, 1990–1996," Journal of Business Research, Elsevier, vol. 85(C), pages 127-141.
    10. Barry Nalebuff, 1999. "Bundling," Yale School of Management Working Papers ysm126, Yale School of Management, revised 01 Dec 2000.
    11. Leme, Maristela Franco Paes & Zylbersztajn, Decio, 2008. "Determinantes da Escolha de Arranjos Institucionais: Evidências na Comercialização de Fertilizantes para Soja," Brazilian Journal of Rural Economy and Sociology (Revista de Economia e Sociologia Rural-RESR), Sociedade Brasileira de Economia e Sociologia Rural, vol. 46(2), pages 1-30, June.
    12. Jens Schmidt & Richard Makadok & Thomas Keil, 2016. "Customer-specific synergies and market convergence," Strategic Management Journal, Wiley Blackwell, vol. 37(5), pages 870-895, May.

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