Alliance governance choices: Disentangling the effects of uncertainty and alliance experience

Eva Niesten, Albert Jolink

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Abstract

This article analyses the interaction between alliance experience and behavioural uncertainty to improve our understanding of alliance governance. We investigate the extent to which the effect of alliance experience on governance choices is explained by a reduction in “mundane” transaction costs or by a reduction in “opportunistic” transaction costs. Based on more than 12,000 firm experiences with equity and non-equity alliances, we demonstrate a reduction in mundane transaction costs over time by firms reusing the same governance structure in successive alliances. We also find that in high behavioural uncertainty alliances, firms rely on their experience as a substitute for equity governance to reduce opportunistic transaction costs.
Original languageEnglish
Pages (from-to)320-333
JournalLong Range Planning
Volume51
Early online date15 Jul 2017
DOIs
Publication statusPublished - Apr 2018

Keywords

  • alliance experience; governance; behavioural uncertainty; transaction costs

Research Beacons, Institutes and Platforms

  • Manchester Institute of Innovation Research

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