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The Coevolution Of Transnational Corporations And Institutions, Sarianna M. Lundan
The Coevolution Of Transnational Corporations And Institutions, Sarianna M. Lundan
Indiana Journal of Global Legal Studies
While economic theories of the firm have traditionally focused on the ownership of assets, the increasing use of contractual partnerships is beginning to challenge our conception of the firm by emphasizing its coordinating role. In structuring their contracts, as well as in managing the relationships governed by the contracts, firms try to mitigate uncertainties that could destroy the value-adding potential of such transactions. These uncertainties may be specific to the transaction partner, but they might also arise from the institutional context of the contracting parties, particularly in the case of transactions that cross borders. The coevolutionary process whereby firms both …
Transnational Corporations, Global Competition Policy, And The Shortcomings Of Private International Law, Gralf-Peter Calliess, Jens Mertens
Transnational Corporations, Global Competition Policy, And The Shortcomings Of Private International Law, Gralf-Peter Calliess, Jens Mertens
Indiana Journal of Global Legal Studies
In this article we criticize the so-called more economic approach to European competition law for disregarding the importance of a functional system of private law. Based on the availability of market governance as an alternative mode for organizing transactions, it is presumed that vertical integration, which is the central organizational structure of transnational corporations, is economically efficient. Since the enforcement of cross-border contracts by state-organized systems of private law, however, is insufficient, "make-or-buy" decisions in international commerce are prejudiced against arms' length transactions in markets. Consequently, international transactions are integrated vertically into firms' structures to a higher degree than comparable …