Dynamics of Network Governance: A Contribution to the Study of Complex Forms

18 Pages Posted: 26 Oct 2005

See all articles by Decio Zylbersztajn

Decio Zylbersztajn

University of Sao Paulo (USP) - Department of Administration

Elizabeth Maria Merc Querido Farina

University of Sao Paulo (USP) - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: October 2005

Abstract

The architecture of complex forms of governance is the focus of this paper. Networks are complex forms of organization designed to govern inter-firm transactions involving horizontal and vertical coordination. The choice among alternative institutional arrangements is affected by relation-specific investments, distributive mechanisms, and dynamic aspects based on relational contractual mechanisms, trust being relevant. The way in which horizontal and vertical coordination levels are connected is an important question. This paper recognizes that price incentives can keep networks structured in addition it introduces the effect of network externalities, offering likewise incentives. The paper presents a semi-formal model that considers the existence of network externalities and applies a game approach to explain the choice among alternative strategies. The concept is applied to two cases of network architecture in agro-industrial relations.

Keywords: Network governance, agro-industrial networks

JEL Classification: B52, D23

Suggested Citation

Zylbersztajn, Decio and Merc Querido Farina, Elizabeth Maria, Dynamics of Network Governance: A Contribution to the Study of Complex Forms (October 2005). Available at SSRN: https://ssrn.com/abstract=824964 or http://dx.doi.org/10.2139/ssrn.824964

Decio Zylbersztajn (Contact Author)

University of Sao Paulo (USP) - Department of Administration ( email )

Av. Prof. Luciano Gualberto
908 - Predio 1 Sala C14
Sao Paulo 05508-900
Brazil
55-11-3032-5966 (Phone)
55-11-3032-5966 (Fax)

Elizabeth Maria Merc Querido Farina

University of Sao Paulo (USP) - Department of Economics ( email )

Av. Pádua Dias, 11 - C.P. 9
Sao Paulo SP, 05508-900
Brazil

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