Institutional-economic perspective

Question 1

5 main sources of transaction costs:

Answer 1

1. Bounded rationality
2. Asymmetric information
3. Opportunism
4. Small numbers bargaining
5. Asset specificity

Question 2

Alternative ways of coordinating transactions:

Answer 2

1. Market
2. Hierarcy (firm)
3. Hybrid

Question 3

The “dark side” of the firm involves:

Answer 3

1. At some point, the cost of conducting one more transaction within the firm becomes equal to the cost of organizing a transaction through the market: bureaucracy is too high and cumbersome (besværlig)
2. Inadequate use of resources

Question 4

The choice of governance mode

Answer 4

Control/coordination costs in the firm < Transaction costs on the market –> Firm (Integration or Hierarchy)

Control/coordination costs in the firm > Transaction costs on the market –> Market (Contract)

Question 5

Trans