BUS 207 Lecture Notes - Lecture 5: Opportunism, Transaction Cost, Market Power

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 207
• Professor: Mark Moore

Document Summary

Cancelled contracts (coninued: what is the problem described here, why can"t the bank of canada and shl sign a contract to cover coningencies such as the. Complete contract speciies the rights and responsibiliies of the paries in all possible circumstances (there are no such thing as complete contract) In what sense is it too late to pull the plug for the government? a. b. Speciic asset: it"s much greater value inside the relaionship than outside: why don"t the problems described in the aricle arise when the government contracts out custodial or food service? a. The price would be more predictable and less complex. Managers must oten decide whether to use the irm or the market as a mean of organizing a transacion in a verical supply chain (that transforms inputs into outputs) Refers to the degree to which it performs (or else contracts out) various aciviies along the industry supply chain.