Transaction Cost Economics: An Assessment of Empirical Research in the Social Sciences

66 Pages Posted: 16 Aug 2006 Last revised: 28 Mar 2012

Barak D. Richman

Duke University - School of Law

Jeffrey Thomas Macher

Georgetown University - McDonough School of Business - Strategy, Economics and Policy

Date Written: August 2006

Abstract

This paper provides a comprehensive review of the empirical literature in transaction cost economics (TCE) across multiple social science disciplines and business fields. We show how TCE has branched out from its economic roots to examine empirical phenomena in several other areas. We find TCE is increasingly being applied not only to business-related fields such as accounting, finance, marketing, and organizational theory, but also to areas outside of business including political science, law, public policy, and agriculture and health. With few exceptions, however, the use of TCE reasoning to inform empirical research in these areas is piecemeal. We find that there is considerable support of many of the central tenets of TCE, but we also observe a number of lingering theoretical and empirical issues that need to be addressed. We conclude by discussing the implications of these issues and outlining directions for future theoretical and empirical work.

Keywords: Transaction Cost Economics, Organizational Theory

JEL Classification: L2, L14, D23

Suggested Citation

Richman, Barak D. and Macher, Jeffrey Thomas, Transaction Cost Economics: An Assessment of Empirical Research in the Social Sciences (August 2006). Duke Law School Legal Studies Paper No. 115. Available at SSRN: https://ssrn.com/abstract=924192 or http://dx.doi.org/10.2139/ssrn.924192

Barak D. Richman (Contact Author)

Duke University - School of Law ( email )

210 Science Drive
Box 90362
Durham, NC 27708
United States
919-613-7244 (Phone)
919-613-7231 (Fax)

Jeffrey Thomas Macher

Georgetown University - McDonough School of Business - Strategy, Economics and Policy ( email )

335 Hariri Building
Washington, DC 20057
United States
202-687-4793 (Phone)

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