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Transaction Cost Economics: The Natural Progression

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  • Oliver E. Williamson

Abstract

This manuscript provides the Nobel laureate's reflections on transaction cost economics. The overview section frames governance as the overarching concept and transaction cost economics as the means by which to breathe operational content into governance and organization. The vertical integration section identifies efficiency factors associated with determining when a firm produces a good or service to its own needs rather than outsource. A discussion of the rudiments of transaction cost analysis is subsequently provided. Puzzles and challenges that require pushing the logic of efficient governance to completion are examined and followed by concluding remarks.
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Suggested Citation

  • Oliver E. Williamson, 2010. "Transaction Cost Economics: The Natural Progression," American Economic Review, American Economic Association, vol. 100(3), pages 673-690, June.
  • Handle: RePEc:aea:aecrev:v:100:y:2010:i:3:p:673-90
    Note: DOI: 10.1257/aer.100.3.673
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights

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