Determinants of organizational form: Transaction costs and institutions in the European trucking industry
AbstractWe explain why European trucking carriers are much smaller and rely more heavily on owner-operators (as opposed to employee drivers) than their US counterparts. Our analysis begins by ruling out differences in technology as the source of those disparities and confirms that standard hypotheses in organizational economics, which have been shown to explain the choice of organizational form in US industry, also apply in Europe. We then argue that the preference for subcontracting over vertical integration in Europe is the result of European institutions—particularly, labor regulation and tax laws—that increase the costs of vertical integration.
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Bibliographic InfoPaper provided by Department of Economics and Business, Universitat Pompeu Fabra in its series Economics Working Papers with number 767.
Date of creation: Jun 2004
Date of revision:
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Web page: http://www.econ.upf.edu/
Transaction costs; governance; hybrids; transportation;
Other versions of this item:
- Benito Arruñada & Manuel González-Díaz & Alberto Fernández, 2004. "Determinants of organizational form: transaction costs and institutions in the European trucking industry," Industrial and Corporate Change, Oxford University Press, vol. 13(6), pages 867-882, December.
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
- L92 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Railroads and Other Surface Transportation
This paper has been announced in the following NEP Reports:
- NEP-ACC-2004-12-13 (Accounting & Auditing)
- NEP-ALL-2004-12-12 (All new papers)
- NEP-COM-2004-12-02 (Industrial Competition)
- NEP-EEC-2004-12-27 (European Economics)
- NEP-MIC-2004-12-23 (Microeconomics)
- NEP-REG-2004-12-22 (Regulation)
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