Abstract
This paper shows that short debt maturities commit equityholders to leverage reductions when refinancing expiring debt in low-profitability states. However, shorter maturities lead to higher ...transaction costs since larger amounts of expiring debt need to be refinanced. We show that this trade-off between higher expected transaction costs against the commitment to reduce leverage in low-profitability states motivates an optimal maturity structure of corporate debt. Since firms with high costs of financial distress and risky cash flows benefit most from committing to leverage reductions, they have a stronger motive to issue short-term debt. Evidence supports the model’s predictions.
Transaction costs economics work has argued that monitoring procedures are needed to evaluate the extent to which overseas partners comply with their obligations. We posit that the transactional ...theory of stress can also inform on how to distinguish opportunists from non-opportunists. Synthesizing these two theories and using a three-study, multimethod design, we examine whether different types of stressors influence opportunism, and how and under what conditions such links are moderated by monitoring. Based on separate surveys of 209 Chinese subsidiaries’ and 232 Chinese suppliers’ cross-border intrafirm and interfirm partnerships with headquarters and buyers, respectively – in conjunction with an add-on experimental study conducted in the US – the results suggest challenge and hindrance stressors impact opportunism differently. The former exhibits a U-shaped, and the latter a positive, relationship with opportunism. We thus observe the importance of both the level and type of stress. Further, the international exchange context matters for monitoring’s efficacy. Monitoring steepens the U-shaped challenge stressors–opportunism relationship in intrafirm (not interfirm) partnerships. It however weakens the positive hindrance stressors–opportunism relationship in interfirm (not intrafirm) partnerships. The findings inform managers on when and how to use monitoring to control challenge and hindrance stressors’ links to opportunism in these contexts.
There is a growing literature reporting the extent of transaction costs for environmental policies. However understanding why transaction costs occur and why they are small or large is also important ...for efficient policy selection and evaluation. Following an analysis of the organisational economics literature and reports of the extent of transaction costs for a number of environmental policies, three key influences to transaction costs in environmental policies are identified. These are the following: 1) the characteristics of the transaction for the environmental good; 2) the nature of the transactors; and 3) the current institutional environment and arrangements. These affect transaction costs to the government and all other parties influenced by a policy. Transaction costs occur due to actions of information collection and policy design, policy enactment and establishment, implementation and contracting, administration and monitoring, and enforcement. An interrogation of transaction cost influences reveals that: 1) the influence varies between parties and is affected by the actions and interactions of and between all parties to a policy; 2) how transaction costs are experienced varies across time; and 3) who experiences transaction costs depends on the policy itself. Future policy selection and refinement will benefit from empirical analysis of the causes of transaction costs.
Digital technologies permit a massive reduction of transaction costs. As a result, traditional social interactions that take place in the entrepreneurial ecosystem are disrupted and a new landscape ...emerges. Digital platforms are the organizational form that benefit most from reductions in transaction costs; they take a prominent advantage from their ability to scout worldwide emergent knowledge, as well their ability to match extraordinarily heterogenous demands with dedicated supply. Digital platforms shape social interactions and the ways value is created in the global economy. As such, they are becoming the cornerstone of the digital entrepreneurship ecosystem. This special issue highlights some of the key features of the renewal of social interactions in the digital entrepreneurship ecosystem and opens up avenues for future research.
Résumé
Les technologies numériques entrainent une réduction massive des coûts de transaction. En conséquence, les interactions sociales qui prennent traditionnellement place dans l'écosystème entrepreneurial sont bouleversées et un nouveau paysage émerge. Les plateformes numériques sont la forme organisationnelle qui bénéficie le plus de la réduction des coûts de transaction. Tout d'abord, elles tirent un avantage majeur de leur capacité à scruter dans le monde entier les connaissances émergentes. Ensuite, leur faculté à faire correspondre des demandes extraordinairement hétérogènes avec les offres dédiées est unique. Les plateformes numériques façonnent les nouvelles interactions sociales et la manière dont la valeur est créée dans l'économie mondiale. À ce titre, elles sont en train de devenir la pierre angulaire de l'écosystème de l'entrepreneuriat numérique. Ce numéro spécial met en lumière certaines des principales caractéristiques du renouvellement des interactions sociales dans l'écosystème de l'entrepreneuriat numérique et ouvre des pistes pour de futures recherches.
Measuring Liquidity in Bond Markets Schestag, Raphael; Schuster, Philipp; Uhrig-Homburg, Marliese
The Review of financial studies,
05/2016, Letnik:
29, Številka:
5
Journal Article
Recenzirano
In the literature, there is no consensus on a common approach to measure bond liquidity. This paper is the first to comprehensively compare all commonly employed liquidity measures based on intraday ...and daily data for the U.S. corporate bond market. We find that high-frequency measures based on intraday data are very strongly correlated, implying that previous results should be robust regarding the chosen measure. Most low-frequency proxies based on daily data generally also measure transaction costs well. However, three proxies clearly take the lead: Corwin and Schultz's (2012) high-low spread estimator, Roll's (1984) measure, and Hasbrouck's (2009) Gibbs measure.
Artificial intelligence (AI) has been presented as a powerful tool in human resource management (HRM), but little academic research exists on the topic. The present study introduces the technology, ...organization, and environment (TOE) model from information systems research and integrates it with the transaction cost theory to better understand the facilitators and the constraints of companies' AI adoption behavior during employee recruitment. Survey results from 297 Chinese companies suggest that companies' perceived complexity toward AI constrains AI adoption, while technology competence and regulatory support encourage AI adoption. Relative advantages of AI technology, company size, and industry have no significant impact on AI usage. The findings also demonstrate the moderating effects of transaction costs on the influential power of technological complexity and organizations' technology competence.
The study of intragroup dynamics in management studies views conflict as a contingency process that can benefit or harm a group based of characteristics of the group and context. We review five ...models of intragroup conflict in management studies. These models include diversity-conflict and behavioral negotiation models that focus primarily on conflict within a group of people; social exchange and transaction cost economics models that focus primarily on conflict within a group of firms; and social dilemma models that focus on conflict in collectives of people, organizations, communities, and generations. The review is constituted by summarizing the insights of each model, foundational papers to each model; the most recent uses and developments of the models in the last decade; the complementarity of these models; and the future research directions.
•Optimal designs of Tradable Credit Scheme (TCS) with asymmetric transaction cost.•Pareto-improving and financial feasibility conditions are derived.•Extended results for heterogeneous commuters.•The ...significant impact of the asymmetry in transaction cost is unveiled.
Tradable credit schemes (TCS) have been promoted as an alternative to congestion pricing in recent years. Most existing TCS studies assume a frictionless trading market that incurs zero transaction cost. In this study, we propose to examine how transaction cost, taking the form of brokerage fee charged by a TCS operator for the deal-matching service, impacts the performance of TCS in the context of morning commute. Unlike the existing studies, the brokerage fee is assumed to be proportional to the transaction value and asymmetrically split between buyers and sellers. Using the bottleneck model, the optimal TCS design is first obtained for the case of homogeneous commuters and asymmetric transaction cost. We also derive the conditions that ensure Pareto-improving for commuters and financial self-sufficiency for the operator. The latter means the brokerage fee can cover the operator’s cost. These analytical results are then extended to cases considering user heterogeneity—which allows commuters to have different values of times (VOT) and desired arrival times at the workplace—and coarse charging design. Among other things, we find that an asymmetric fee structure is better for system performance when buyers bear a higher share of the transaction cost.
Although transaction costs (TCs) that affect the total project costs are a common phenomenon in the Pakistani construction industry, the causes that escalate the TCs are ambiguous, and public sector ...organizations are unable to manage these causes efficiently. To investigate the causes of escalation of TCs in public sector construction projects, a total of 30 causes were first identified through a review of the literature and factor analysis was employed for further analysis. The semi-structured interviews were conducted with 8 professionals from the construction industry in Pakistan. The primary data used to prioritize the causes of escalation of TCs were collected from survey questionnaires in which causes such as inadequate investigation, an unclear work scope, project complexity and incomplete design and specification ranked the highest. Finally, factor analysis was used and identified 5 major underlying dimensions of the causes, namely, the procurement and contracting management, the contractor relationship management, the project external environment, managing project finance and the project transaction environment. The contribution of this research lies in the identification and examination of the underlying causes of TC escalation, as discerned by the industry professionals. All factors are important, but in the local context, soft aspects (contract relationship) and hard aspects (financial management) are additional factors perceived by the experienced professional in overcoming TC escalation issues. This could be a point of reference in the public sector construction industries of developing countries, which are characterized by their unique economic and social systems.
We analyze how pro-market institutions affect firm performance in emerging markets. Integrating transaction costs and signaling theory, we advance three arguments. First, we separate four dynamic ...components of pro-market institutions: intensifying and fading pro-market reforms and intensifying and fading pro-market reversals. Second, we propose an asymmetric dynamic view whereby not only intensifying reforms but also fading reversals improve firm performance, while not only fading reforms but also intensifying reversals reduce performance. Finally, we argue that more efficient firms perform better under each of the dynamics. We test these arguments on a sample of 1092 firms from 34 emerging markets during 1998–2011.
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