Formal governance, interfirm coordination, and performance in partnerships: An empirical investigation of a mediation model

Young Rok Choi, Phillip Phan and Jaepil Choi

European Management Journal, 2020, vol. 38, issue 3, 413-424

Abstract: This study investigates the extent to which formal governance mechanisms such as contracts and equity ownership affect interfirm coordination and partnership performance. We analysed data from a survey of 301 Korean firms to show that interfirm coordination partially mediates the relationship between contract completeness, defined as the extent to which a contract specifies task operations and contingencies, and partnership performance. Furthermore, we find that more complete contracts can attenuate the negative effects of equity ownership on coordination, and that this effect is particularly strong when partner tasks are interdependent and relational norms are weak.

Keywords: Interfirm partnerships; Coordination; Contracts; Equity ownership; Formal control; Partnership performance (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eurman:v:38:y:2020:i:3:p:413-424

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DOI: 10.1016/j.emj.2019.12.005

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