The topic of the article is the analysis of the concept of transaction cost economics based on various sources of practical and academic nature.
The problem highlighted by the researchers exists since the inception of the theory of transaction costs – while such costs undoubtedly exist, it may be quite challenging to quantify and predict such costs within a mathematical or statistical model of any given case.
The methodology of the researchers may be considered by all means innovative. Instead of analyzing particular situations and attempting to draw an equation for the quantification of transaction costs, a qualitative and quantitative analysis is made for the research articles published in the previous two decades, for the total of 338 articles. Without naming any particular cases, the authors performed a statistical survey, pointing out the articles which displayed a strong interdependency of variables – elements of a business transaction – as a quantitative backup of the transaction cost theory. Such articles formed slightly over 40% of the entire data researched.
Despite the fact that a considerable part of the researched articles proved a correlation between the transaction practices and final cost fluctuation, the overall ratio of significant and irrelevant data within the massive of information researched demonstrates the present insufficiency of quantitative indicators that would allow to draw a united formula for the calculation of transaction costs in the present economy.
David, R.J., and Han, S.-K. (2004). A Systematic Assessment of the Empirical Support for
Transaction Cost Economics. Strategic Management Journal, 25: 39-58 (2004).