The Choice of the Form of Strategic Alliances: Transaction Cost Economics and beyond *

This paper focuses on the choice of the governance form of strategic alliances. We survey arguments inspired by the transaction cost economics tradition and other contractual perspectives on the theory of the firm, according to which such choice mainly depends on the transaction cost economizing properties of different organizational forms. We proposes additional considerations based on evolutionary and competence based theories of the firms which emphasize the role of interactive learning in shaping forms’ decisions. In the empirical section, we analyze a sample composed of 140 bilateral contractual (i.e. non equity) agreements and equity joint ventures concluded in the period 1983-’86 by 68 North American, European and Japanese enterprises out of the world largest firms in Information Technology industries. In accordance with the results of previous studies informed by transaction cost economics, the estimates of a logit econometric model provides evidence that firms tend to resort to equity forms to govern complex transactions. On the contrary, for collaborations in the technological sphere they are more likely to use contractual modes. More importantly, the form of alliances proves to be dependent upon the technological capabilities of partner firms, with the probability that a given collaboration be a joint venture decreasing with the degree of overlapping of firms’ patterns of technological specialization. Paper prepared for the DRUID Conference on “Competencies, Governance and Entrepreunership”, Copenhagen, 9-11 June 1998 First draft. Please, do not quote without author’s permission. __________________________ (*) Financial support from University of Pavia 1997 FAR funds is gratefully acknowledged. Corresponding address: CIRET, Dipartimento di Economia e Produzione Politecnico di Milano P.za Leonardo da Vinci, 32 20133 Milan, ITALY [email protected]