Distrust And Dominance In Managing Alternative Work Arrangements: A Micro-Analytic Test Of Transaction Cost Theory

Abstract

Organizations that successfully outsource may see better value-creation in creating a sustainable competitive advantage. The objectives of this study were threefold: a) provide a framework for studying the effects of perceived distrust that leads to dominance, b) analyze how opportunism parlays into the concept of dominance, and c) determine if the relationship between outsource partners varies by analyzing transaction characteristics. Our research shows that firms should take caution to fully understand the effects that contract size has on a firm’s resources.