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Transaction cost analysis of strategy‐structure choice
Author(s) -
Jones Gareth R.,
Hill Charles W. L.
Publication year - 1988
Publication title -
strategic management journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 11.035
H-Index - 286
eISSN - 1097-0266
pISSN - 0143-2095
DOI - 10.1002/smj.4250090206
Subject(s) - transaction cost , industrial organization , internalization theory , strategic management , business , strategy implementation , database transaction , limit (mathematics) , organizational structure , microeconomics , work (physics) , process management , computer science , marketing , economics , management , mathematics , mathematical analysis , programming language , mechanical engineering , engineering
Using a transaction cost approach this paper analyzes the relationship between strategy, structure and organizational performance. It addresses three related questions. First, what determines the limit to growth through internalization for a firm pursing a particular strategy? Second, why does a firm pursue different strategies for achieving growth? Third, what determines changes in the strategy and structure used by the firm over time? This analysis serves to integrate work in strategic management and provides a framework for analyzing corporate strategy choice.