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Informal Governance and Its Impact on Transactional Uncertainty of Transnational Companies: The Case of Social Relatedness

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  • Kim-Leong Chung

    ()
    (University of Bremen - Faculty of Business Studies and Economics)

  • Jörg Freiling

    ()
    (University of Bremen - Faculty of Business Studies and Economics & ZenTra)

  • Sven M. Laudien

    ()
    (Otto von Guericke University Magdeburg & ZenTra)

Abstract

Due to their particular characteristics, transnational companies (TNC) face numerous challenges, in particular dealing with uncertainty in both external and internal transactions. In this paper, we investigate whether and how far individual and inter-personal interactions among members of the internal units of TNC influence their transactional relationships. We develop the proposition that social relatedness is a crucial means to cope with transactional uncertainty in cross-border relationships within organizational boundaries. Our empirical study provides first support of this causality.

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Bibliographic Info

Paper provided by ZenTra - Center for Transnational Studies in its series ZenTra Working Papers in Transnational Studies with number 15 / 2013.

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Length: 17 pages
Date of creation: Apr 2013
Date of revision: Apr 2013
Handle: RePEc:zen:wpaper:15

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Keywords: informal governance; social relatedness; transactional uncertainty; transnational companies;

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