The effect of transaction cost antecedents on control mechanisms: Exporters’ psychic distance and economic knowledge as moderators

Harash J. Sachdev and Daniel C. Bello

International Business Review, 2014, vol. 23, issue 2, 440-454

Abstract: The purpose of this research is to determine how a manufacturer's reduction in export involvement barriers may moderate the effect of transaction cost drivers on control mechanisms (monitoring and information sharing). Utilizing Transaction Cost Analysis and internationalization literature, asset specificity and environment diversity are the transaction cost drivers and economic knowledge and psychic distance are the moderators. The results indicate that as manufacturers increase export involvement through reduction in economic knowledge differences it strengthens the positive relationship between asset specificity and monitoring and diversity and monitoring and weakens the corresponding relationships with information sharing. Psychic distance reduction weakened the positive effect between asset specificity and information sharing only. The results of the other three hypotheses were in the direction hypothesized but non-significant. Manufacturers may continue export involvement through intermediary usage provided they regulate their monitoring and information sharing practices in accordance with the overall influence of asset specificity, diversity, economic knowledge, and psychic distance.

Keywords: Export exchanges; Transaction cost; Control mechanisms; Economic knowledge; Psychic distance barriers (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0969593113001005
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:iburev:v:23:y:2014:i:2:p:440-454

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/journaldescription.cws_home/133/bibliographic
http://www.elsevier. ... me/133/bibliographic

DOI: 10.1016/j.ibusrev.2013.07.003

Access Statistics for this article

International Business Review is currently edited by P. Ghauri

More articles in International Business Review from Elsevier
Bibliographic data for series maintained by Catherine Liu ().