A study on the problems of the structure of transaction costs

  • Received August 31, 2017;
    Accepted October 2, 2017;
    Published October 31, 2017
  • Author(s)
    Evgeny A. Kuzmin
  • DOI
    http://dx.doi.org/10.21511/ppm.15(3-1).2017.06
  • Article Info
    Volume 15 2017, Issue #3, pp. 224-233
  • TO CITE АНОТАЦІЯ
  • Cited by
    1 articles
  • 1059 Views
  • 195 Downloads

Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License

The estimation of transaction costs is a well-known methodological problem, the solution of which determines the possibility, among other things, to estimate the conditions for business operations. The growing complexity of the social and economic interaction emphasizes the special role of transaction costs in regulation of the stability condition. The article analyzes approaches to the determination of the essential characteristics of transaction costs. The scientific evidence of dividing of transaction costs into normal and recertative is provided. Their differentiation is connected to the impact of uncertainty and also the principal unavoidability of transaction costs regardless the efficiency of the economic mechanism and other factors. An important factor here is friction force – flexibility of the economic space. The growth of transaction costs that is observed with the increased uncertainty emphasizes only the revealed features in the friction force of the economic environment. All this led to the conclusion on the availability of a generalizing factor that estimates the conditions of exchange transactions. For this, the notion of transaction capacity was introduced; it expresses the cumulative impact of the external and internal conditions, which, this way or another, are understood by the specialists making the managerial decisions. The existence of some value of transaction costs when transaction is declined presupposes an important assumption that the transaction capacity has the same limits of dynamics. The obtained results allow us to build a function of transaction capacity, which shall be considered as a tool for risk-profile analysis.

view full abstract hide full abstract
    • Figure 1. Function of transaction capacity
    • Figure 2. Scheme of component ratio of normal and recertative transaction costs
    • Arrow, K. (1993). Capacities and Limits of the Market as a Mechanism of Resources Distribution. THESIS, 1(2), 53-68.
    • Auzan, A. (Ed.). (2006). Institutional Economics: New Institutional Economic Theory, 51 p. Moscow: Infra-M, 415 p.
    • Barbakov, O. M., & Kuzmin, E. A. (2015). Institutional Efficiency and Processes of Institutional Changes (as Seen by the Russian Academic Tradition). Asian Social Science, 11(6), 163-170.
    • Chiles, T. H., & McMackin, J. F. (1996). Integrating Variable Risk Preferences, Trust, and Transaction Cost Economics. Academy of Management Review, 21(1), 73-99.
    • Davidson, P. (2002). Financial Markets, Money, and the Real World, 208 p. Edward Elgar Publishing, 265 p.
    • Harris, L. (2003). Trading and Exchanges: Market Microstructure for Practitioner, 299 p. Oxford University Press, 643 p.
    • Islamutdinov, V. F. (2009). Institutional Aspects of Taxes. In Problems of Accounting, Analysis, Audit and Taxation.
    • Kleiner, G. (1994). Risks of Industrial Enterprises (How to Reduce and Compensate). Russian Economic Journal, 5-6, 85-92.
    • Kleiner, G. B., Tambovtsev, V. L., & Kachalov, R. M. (1997). Enterprise in Unstable Economic Environment: Risks, Stretegies, Safety. Moscow: Ekonomika.
    • Kokorev, V. (1998). Transaction Costs ad valorem. In V. L. Tambovtseva (Ed.), Factor of Transaction Costs in the Theory and Practice of Russian Reforms: Based on the Materials of the Same Roundtable Discussion (pp. 71-87). Moscow: TEIS.
    • Kuzmin, E .A. (2012). Uncertainty and certainty in the management of organizational and economic systems. Ekaterinburg: Institute of Economics of Ural Branch of RAS.
    • Kuzminov, Ya. I., & Yudkevich, M. M. (2002). Institutional Economics (p. 62). Moscow: MIPT.
    • Kuzminov, Ya. I., Bendukidze, K. A., & Yudkevich, M. M. (2006). Course of Institutional Economics: Institutions, Networks, Transaction Costs, Contracts, 229 p. Moscow: Publishing House of the Higher School of Economics, 442 p.
    • Maher, M. E. (1997). Transaction Cost Economics and Contractual Relations. Cambridge Journal of Economics, 21(2), 147-170.
    • Malakhov, S. (1996). Some Aspects of the Theory of Imperfect Competitive Equilibrium (Two- Factor Model of Transaction Costs). Problems of Economy, 10, 89-102.
    • Masters, J. K., Miles, G., D’Souza, D., & Orr, J. P. (2004). Risk Propensity, Trust and Transaction Cots in Relational Contracting. Journal of Business Strategies, 21(1), 47-67.
    • Matthews, R. C. O. (1986). The Economics of Institutions and the Sources of Growth. Economic Journal, 96, 906.
    • Popov, E. V. (2011). Transactions, 472 p. Ekaterinburg: UD RAS, 679 p.
    • Radaev, V. V. (1999). Russian Business: Structure of Transaction Costs. Social Sciences and Modern Times, 6, 5-19.
    • Shevyakov, A., & Kleiner, G. (1993). Social and Economic Monitoring: Concept, Problems, Perspectives. Economics and Mathematical Methods, 29(1), 5-14.
    • Slater, G., & Spencer, D. A. (2000). The Uncertain Foundations of Transaction Costs Economics. Journal of Economic Issues, 34(1), 61-87.
    • Stroev, E. S., Mayorov, A. N., Lebedkin, V. M. et al. (1995). Success of Reforms Is in Perception of Necessity: Experience of Agrarian Transformations in Oryol Region. Oryol: Turgenevskii berezhok, 152 p.
    • Tatarkin, A. I. (2004). Dynamics of Corporative Development (p. 26). Moscow: Nauka.
    • Wallis, J. J., & North, D. (1986). Measuring the Transaction Sector in the American Economy, 1870-1970. In Engerman, S. L., & Gallman, R. E. (Eds.), Long-Term Factors in American Economic Growth, 96 p. University of Chicago Press, 898 p.
Related Articles

  • Factors of enterprises’ strategic selection of participation forms in integration formations

    Vаlentyna StadnykORCID , Pavlo Izhevskiy , Oksana Zamazii , Andriy Goncharuk , Oksana Melnichuk doi: http://dx.doi.org/10.21511/ppm.16(2).2018.09
    Problems and Perspectives in Management Volume 16, 2018         Issue #2         pp. 90-101 Views: 1160 Downloads: 166 TO CITE АНОТАЦІЯ

    The competitiveness of the national economy is ensured by mutually beneficial cooperation of various business activities and industrial specialization of business units. The purpose of this article is to identify the main motives of the economic behavior of business units in Ukraine, which predetermine structural changes in the industrial sector and agro-industrial complex, and to develop an algorithm for substantiating the strategic choice of participating forms in integration formations for the business development. The economic and statistical analysis has identified trends in structural changes in the industrial and agricultural sectors of the Ukrainian economy. By generalization of scientific views on the content of integration processes, there were identified the influence of institutional factors on the development of forms of integration interaction and maintaining the stability of integrational entities, and the factors of technological and logistic expediency on the formation and development of business networks. There was formed the algorithm of substantiation of strategic decisions regarding the choice of enterprises of the forms of participation in the integration formations of different types. The differences in the positions of the initiators of the business network creation and the participants involved in them were identified regarding the composition and relationships in the network that affect its sustainability. The application of this algorithm will ensure that the management of enterprises makes more substantiated decisions on the creation of an organizational framework for the implementation of competitive strategies in promising areas of inter-sectoral cooperation.

Download Preview
Close
Problems and Perspectives in Management
Problems and Perspectives in Management