In this paper we seek to integrate human needs and self-actualisation into the design of organisational governance. We problematise the assumptions that guide established justifications for governance, thus providing an opportunity for this type of theoretical approach. Drawing on Maslow's human psychology, we consider the potentially regressive features of the prescriptions of transaction cost theory (TCT), particularly the new institutionalist approach, and suggest inclusiveness as a mode of coordination that firms may wish to pursue to enhance self-actualisation. The main value added of this contribution is to highlight the need to discern among modes of governance design, using criteria of welfare maximisation by enabling opportunities for self-actualisation within the firm, different from the TCT focus on internal efficiency.

Contracting out publicly funded vocational education and training (VET) in Australia to private providers has been accompanied by persistent concern at decline in the quality of training. Using transaction cost economics, this outcome is ascribed to the characteristics of publicly funded VET as a commodity and the conditions under which it is privately produced and consumed. The article concludes that, in general, publicly funded VET does not meet the minimum conditions for efficient contracting out. The economic and social consequences of inadequate quality VET provision are potentially severe.

Williamson's legacy will be permanently, and deservedly, linked with the theory of the firm. As important, however, is his contribution to our understanding of contracting. My aim here is to describe Williamson's conception of contracting, how it differs from other approaches to contracting, and some implications of that approach for contract design and enforcement. I argue that Williamson's ‘process orientation’ – in which the main dimension along which contracts vary is the extent to which contract adjustments are effected through court ordering versus private ordering – provides alternative interpretations of some conventional contract terms but also sheds light on some otherwise puzzling contractual phenomena.

This contribution commemorates Oliver Williamson, who recently passed away, as one of the founding fathers of Transaction Cost Economics (TCE). It does so by touching on some of the details of his personal life and connecting these with his professional career. The latter was devoted to putting the study of institutions on the economic agenda. Closer scrutiny reveals that three phases may be identified. Williamson first developed an interest in analysing vertical integration. During the second phase, he elaborated this interest in TCE, and during the third, he positioned his contributions within the area of institutional economics. Furthermore, the article considers the various influences of institutional and organizational economists on Williamson. Finally, the article considers the reception, criticism, and further elaborations of Williamson's contributions.

In this essay, we honour the memory of Oliver Williamson by reflecting on Chiles and McMackin's 1996 Academy of Management Review article ‘Integrating variable risk preferences, trust, and transaction cost economics’. The article, which built on Williamson's work in transaction cost economics (TCE), went on to attract attention not only from the authors’ home discipline of management and organisation studies, but also from other business disciplines, the professions and the social sciences. After revisiting the article's origins and core arguments, we turn to selectively (re)view TCE's development since 1996 through the lens of this article, focusing on trust, risk and subjective costs. We cover conceptual and empirical developments in each of these areas and reflect on how our review contributes to previous debates concerning trade-offs implicit in relaxing TCE's behavioural assumptions. We conclude by reflecting on key points of learning from our review and possible implications for future research.

Joseph Campbell describes a narrative pattern for a hero's journey. ‘A hero ventures forth from the world of common day into a region of supernatural wonder: fabulous forces are there encountered and a decisive victory is won: the hero comes back from the mysterious adventure with the power to bestow boons on his fellow man’ (2008: 30). This paper looks at Oliver E. Williamson's life through Campbell's lens and reveals his journey, challenges, and triumphs not only for himself but also for all students of the science of organization.

This paper provides a comprehensive review of the empirical literature in transaction cost economics (TCE) across multiple social science disciplines and business fields. We show how TCE has branched out from its economic roots to examine empirical phenomena in several other areas. We find TCE is increasingly being applied not only to business-related fields such as accounting, finance, marketing, and organizational theory, but also to areas outside of business including political science, law, public policy, and agriculture and health. With few exceptions, however, the use of TCE reasoning to inform empirical research in these areas is piecemeal. We find that there is considerable support of many of the central tenets of TCE, but we also observe a number of lingering theoretical and empirical issues that need to be addressed. We conclude by discussing the implications of these issues and outlining directions for future theoretical and empirical work.

This paper compares the economic efficiency of firm-agency governance structures for pollution reduction using transaction costs economics. Two governance structures are analyzed with the transaction costs approach: command and control regulation (CCR) and negotiated agreements (NAs). We propose that the choice of governance structure depends on the strategies firms pursue given the attributes of their transactions and their market opportunities. The application of transaction cost economics analysis leads to different choices of regulatory instruments. Firms in more mature, stable industries are likely to choose command and control, while firms in new, dynamic sectors are more likely to opt for negotiated agreements. Frequency of transactions is a key factor in firm choice.

This paper examines the influence of risks on alliance governance modes in high-tech industries. The extant literature has devoted little attention to the preferred governance mode based on the risks surrounding alliances. In this paper, we examine why risks are key factors in the alliance governance decision and investigate the choice of alliance governance mode in high-tech industries. Hypotheses are formulated based on risk perspectives; these hypotheses are empirically tested using data on 3,228 alliance records generated over the past 5 years in high-tech industries. The results suggest that risk perspectives provide an effective rationale for choosing an alliance governance mode in a high-tech industry. In the conclusion, we discuss critical issues in the current debates on predicting alliance governance modes.

Risks that emerge during the implementation and enforcement stages of defense procurement help explain procurement outcomes. Adverse events have impacts on the timing, cost and quality of goods supplied. The procurement process is analyzed on the basis of an original dataset covering 48 defense procurement contracts signed by the French Ministry of Defense with 18 European contractors. Contractual problems create the most adverse events in this sector, while technological risk is the second most significant risk. Although opportunism takes various forms, it is found only rarely in these defense contracts.

This article first describes the history of the use of the term ‘new institutional economics’ (NIE) since its introduction by Oliver Williamson. It shows how the term has evolved from a generic term to a standard term on the basis of NIE conference publications and collective volumes that appeared between 1984 and 1997. In 1997, the International Society for New Institutional Economics was founded. Ronald Coase, Douglass North and Oliver Williamson were the driving force behind this development. In the second part of this article, the meaning of the NIE is outlined according to the basic concepts of Williamson and North. The ideas of these two protagonists are compared with each other and their better-known criticisms are described and assessed. The final part of the article deals with possibilities for broadening and deepening the objectives and analytical style of the NIE. It concludes with the observation that the potentialities of the NIE are far from being exhausted.