Corporate-level strategy

Question 1

Hold-up

Answer 1

A firm holds up its trading partner by attempting to renegotiate the terms of a deal.
The danger of hold-up is particularly high if uncertainty is high and contracts are rather incomplete and when the deal generates quasi-rents for its trading partner

Question 2

Why does the Hold-up problem increases the transaction costs of using the market?

Answer 2

Because:

• It complicates pre-contractual negotiations and renegotiations
• It increases inefficient investments of trading partners to improve the ex-post bargaining position

Question 3

Why can the hierarchy better handle uncertainty and asset specificity than the market?

Answer 3

• Hierarchy provides a greater range of control, management and sanctions instruments than the market
• Hierarchy brings resources under the same ownership. The durability of the transaction relationship decreases opportunism (time spirit)

Question 4

Phase stats: Zufallsvorgang?

Answer 4

Zufallsvorgänge, die geplannt sind und kontrolliert ablaufen, heissen Zufallsexperiment

Question 5

Phase stat: X de 0,qqc = … (question style: Welche Lebensdauer wird von 95% der Reifen nicht überschritten?)

Answer 5

X de 0,qqc = Mu + U de p * o avectrait en haut a droite