A key strategic decision for many firms is the breadth of their relationships with partners. Existing theories of relationship scope are limited in that they disregard two key aspects of interfirm networks: (1) that most firms transact within networks of multiple partners, and (2) that these...

This paper develops a model of relational contracting to help explain the prevalence of multiunit franchising; a phenomenon not fully understood in the literature. The model is used to derive a key prediction, which is that franchise systems with a greater propensity to engage in multiunit...

We study relational contracts as a means to govern transactions across firm boundaries. We focus on the airline industry, where real-time adaptation of flight schedules under bad weather is not formally contractible, and yet is essential for performance and long-term profitability. While...

This paper studies how pay transparency affects organizations that reward employees based on their efforts (i.e., using "subjective performance evaluation"). First, we show that transparency triggers social comparisons that require the organization to pay its employees an "envy premium". This...

This paper studies how pay transparency affects organizations that reward employees based on their efforts (i.e., using "subjective performance evaluation"). First, we show that transparency triggers social comparisons that require the organization to pay its employees an "envy premium". This...

Research on collaborative ties in business markets has pre-dominantly studied how governance forms balance potential gains and transaction hazards within the relationship. Using an incomplete contracting approach, we examine how the OEM trades off gains obtained within the relationship with its...