Informal Governance and Its Impact on Transactional Uncertainty of Transnational Companies: The Case of Social Relatedness

17 Pages Posted: 24 Apr 2013

See all articles by Kim-Leong Chung

Kim-Leong Chung

University of Bremen - Faculty of Business Studies and Economics

Jörg Freiling

University of Bremen - Faculty of Business Studies and Economics

Sven M. Laudien

affiliation not provided to SSRN

Date Written: April 23, 2013

Abstract

Due to their particular characteristics, transnational companies (TNC) face numerous challenges, in particular dealing with uncertainty in both external and internal transactions. In this paper, we investigate whether and how far individual and inter-personal interactions among members of the internal units of TNC influence their transactional relationships. We develop the proposition that social relatedness is a crucial means to cope with transactional uncertainty in cross‐border relationships within organizational boundaries. Our empirical study provides first support of this causality.

Keywords: Informal Governance, Social Relatedness, Transactional Uncertainty, Transnational Companies

JEL Classification: D83, F23, L14, M16

Suggested Citation

Chung, Kim-Leong and Freiling, Jörg and Laudien, Sven M., Informal Governance and Its Impact on Transactional Uncertainty of Transnational Companies: The Case of Social Relatedness (April 23, 2013). ZenTra Working Paper in Transnational Studies No. 15/2013. Available at SSRN: https://ssrn.com/abstract=2255388 or http://dx.doi.org/10.2139/ssrn.2255388

Kim-Leong Chung (Contact Author)

University of Bremen - Faculty of Business Studies and Economics ( email )

Bremen, D-28359
Germany

HOME PAGE: http://www.lemex.uni-bremen.de

Jörg Freiling

University of Bremen - Faculty of Business Studies and Economics ( email )

Wilhelm-Herbst-Str. 5
Bremen, D-28359
Germany
++49 421 218 66870 (Phone)
++49 421 218 66902 (Fax)

HOME PAGE: http://www.lemex.uni-bremen.de

Sven M. Laudien

affiliation not provided to SSRN

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