Filling a gap in traditional transaction cost economics:: Towards transaction benefits-based analysis

This paper analyzes dyadic partnership formation between asymmetric buyers and specialized suppliers. In the first part of the paper different economics of organization-based approaches are evaluated. Their basic implications concerning the rise of partnerships are derived. In the second part a dynamized transaction cost and benefit model is introduced to analyze the most critical elements of a typical partnership decision. The final part is based on insights from practice and in-depth interviews among 12 specialized suppliers and their four large incumbent partners in the Information and Telecommunications Industry. (C) 2002 Elsevier Science B.V. All rights reserved.