Governing Relationships: Theory, Evidence, and Opportunities

Ricard Gil () and Giorgio Zanarone ()
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Ricard Gil: IESE Business School
Giorgio Zanarone: University of Lausanne

Chapter 25 in Handbook of New Institutional Economics, 2025, pp 621-649 from Springer

Abstract: Abstract In this chapter, we provide a framework to investigate the interaction between the “hardware” (formal contracting) and the “software” (relational contracting) of economic collaborations, both within and between firms. First, we present a simple formulation of the “canonical model” of relational contracting and highlight its key empirical implications. Next, we discuss selected empirical works that shed light on the relevance and testability of the model’s predictions. While significant progress has been made at measuring the complementarity between formal and relational contracts, our investigation highlights several implications of the model that are consistent with anecdotes yet lack systematic empirical verification. Testing these implications is an exciting opportunity for future scholars in the field.

Keywords: Governance; Formal contracts; Relational contracts; Enforcement; Evidence (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-50810-3_25

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DOI: 10.1007/978-3-031-50810-3_25

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