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Firms Facing New Institutions: Transactional Governance in Romania

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  • Peter Murrell

    () (Department of Economics, University of Maryland)

Abstract

How quickly do firms respond to new institutions? Romanian survey data permits investigation of this question, using variables summarizing firms' strategies on transactional governance. These variables are regressed on the factors that should determine efficient behavior according to standard agency and transaction-cost theories. The results suggest that transactional strategies do not currently reflect efficiency considerations. Instead, behavior reflects peculiarities of transition: history, ownership, and state-relations are more important in determining responses to new institutions. Firms use institutions but do not evidence efficient responses to them. Appropriate institutional reform deploys information on how firms adjust to institutions before the long-run.

Suggested Citation

  • Peter Murrell, 2003. "Firms Facing New Institutions: Transactional Governance in Romania," Electronic Working Papers 03-001, University of Maryland, Department of Economics.
  • Handle: RePEc:umd:umdeco:03-001
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    References listed on IDEAS

    as
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    Cited by:

    1. Djankov, Simeon & Glaeser, Edward & La Porta, Rafael & Lopez-de-Silanes, Florencio & Shleifer, Andrei, 2003. "The new comparative economics," Journal of Comparative Economics, Elsevier, vol. 31(4), pages 595-619, December.
    2. Pyle, William, 2006. "Resolutions, recoveries and relationships: The evolution of payment disputes in Central and Eastern Europe," Journal of Comparative Economics, Elsevier, vol. 34(2), pages 317-337, June.
    3. Omar Azfar & Peter Murrell, 2009. "Identifying Reticent Respondents: Assessing the Quality of Survey Data on Corruption and Values," Economic Development and Cultural Change, University of Chicago Press, vol. 57(2), pages 387-411, January.
    4. repec:ksa:szemle:1740 is not listed on IDEAS

    More about this item

    Keywords

    Law; Institutions; transition; restructuring; legal systems; transactional governance; Romania;

    JEL classification:

    • P31 - Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • P37 - Economic Systems - - Socialist Institutions and Their Transitions - - - Legal
    • K12 - Law and Economics - - Basic Areas of Law - - - Contract Law

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