Product complexity as a determinant of transaction governance structure: An empirical comparison of web-only and traditional banks.

Aimao Zhang, Han Reichgelt, Johannes (Han) Reichgelt

Research output: Contribution to journalArticlepeer-review

Abstract

A transaction governance structure (TGS) is a structure that mediates exchanges of goods or services among different agents or production stages (Williamson, 1979, 1981). According to transaction cost economics (TCEs), a selection of TGS for the trade of a particular product depends on the characteristics of the transaction, such as asset specificity, uncertainty, and frequency. This article argues that TCE alone is not sufficient to explain the selection of a TGS. Product complexity also plays an important role in explaining why a particular TGS is selected for a particular product. The construct of product complexity originated in the field of industrial marketing and is an important factor in the study of purchasing behaviors of buyers, decision-making processes of suppliers, and dynamic relations between buyers and suppliers. This study integrates industrial marketing with TCE and examines the impact of product complexity on TGS in the context of banking.

Original languageAmerican English
JournalDefault journal
StatePublished - Jan 1 2006

Keywords

  • E-commerce measurement
  • Financial services industry
  • Instrument design
  • Online banking
  • Product complexity
  • Transaction cost economies
  • Transaction governance structure

Disciplines

  • Business

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