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Jun 27, 2017 · Unlike other streams of business ethics following a voluntaristic approach concerned with the rightness of the behavior of executives and business people (Freeman and Reed 1983; Friedman and Miles 2006) – such as stakeholder theory – the combination of transaction cost economics (TCE) and business ethics aims to shed light on issues of structure, that is, to show how the constraints of law ...
- Alejandro.AGAFONOW@essca.fr
Transaction Costs Theory. Transaction Cost Theory (TCT) is defined as a theory that focuses on the effort, resources, or cost required for two parties to complete an exchange beyond the cost of the product or service itself. The goal of TCT is to maximize transaction performance and minimize costs in various business transactions.
This paper explores ethical activity within a transaction cost (TC) framework. It discusses the theoretical and practical links between TC economisation and ethical and trust-based behaviour. By engendering a climate of trust at the micro/firm level, ethical behaviour can reduce TCs associated with monitoring and protection against broken contracts.
Transaction Cost Economics (TCE) is one of the most established theories to address this fundamental question.Ronald H. Coase, in 1937, was the first to highlight the importance of understanding the costs of transacting, but TCE as a formal theory started in earnest in the late 1960s and early 1970s as an attempt to understand and to make empirical predictions about vertical integration ...
- Comparing Legitimacy and Legality Through The Lens of Transaction Cost Economics
- Legitimacy and The Various Levels of Analysis
- Legitimacy on Different Observation Levels, and Transaction Costs
- Transaction Costs of Actors with Low Legitimacy
- The Importance of Legitimacy in Relational Transactions
When considering the distinction between legality and legitimacy from the point of transaction cost theory, the same question as discussed prior arises as to which of the two concepts is more efficient or whether a combination of them is preferable. Institutional economists have to deal with the tradeoff between the two concepts. In a comparison of...
In the previous discussion, the focus was on the importance of legitimacy for actors conducting transactions through which companies access resources that are critical for their survival and growth. Now the three levels that provide the frame for transactions are considered. (Luhmann (1986) distinguishes function, organization, and psychic systems....
In the previous section, the question of legitimacy based on different levels was addressed. In this regard, it is important to focus on transaction costs, as this is the aim of this chapter. As already mentioned above, transaction costs can be divided into ex-ante (such as information and search costs, or negotiation and contracting costs) and ex-...
Transaction costs should not only be viewed from the perspective that transactions are made with actors whose legitimacy is in question. The question is not only about the impact on transaction costs when conducting transactions with an actor who has low legitimacy but also about how the transaction costs of the actor who himself has only low legit...
In this chapter, the focus is mostly on exchange transactions, which are executed primarily under classical or neo-classical contracts. However, for relational transactions, legitimacy is even more critical, because actors rely primarily on informal safeguards. (For a detailed analysis see Wieland 2018) Legitimacy is a decision metric for the expec...
Jun 27, 2017 · Business ethics or business ethics is a discipline in applied ethics, which deals with the analysis of the moral of how economic actors (companies, shareholders, employees, customers, etc.) acts.
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Feb 2, 2021 · Transaction cost theory (TCT) has been fruitfully applied to a wide range of organizational phenomena, as reflected in a vast and evolving body of research. However, in part due to the theory’s broad success, important advances in some fields have not diffused to other fields. In this essay, we lay out a path toward a pluralistic view of TCT that incorporates insights from multiple fields ...
