Determinants of organizational form: Transaction costs and institutions in the European trucking industry

Benito Arruñada, Manuel González and Alberto Fernández

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: We explain why European trucking carriers are much smaller and rely more heavily on owner-operators (as opposed to employee drivers) than their US counterparts. Our analysis begins by ruling out differences in technology as the source of those disparities and confirms that standard hypotheses in organizational economics, which have been shown to explain the choice of organizational form in US industry, also apply in Europe. We then argue that the preference for subcontracting over vertical integration in Europe is the result of European institutions—particularly, labor regulation and tax laws—that increase the costs of vertical integration.

Keywords: Transaction costs; governance; hybrids; transportation (search for similar items in EconPapers)
JEL-codes: D23 L14 L22 L92 (search for similar items in EconPapers)
Date: 2004-06
New Economics Papers: this item is included in nep-acc, nep-com, nep-eec, nep-mic and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (8)

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Journal Article: Determinants of organizational form: transaction costs and institutions in the European trucking industry (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:767

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