REAL OPTIONS IN FRANCHISE CONTRACTING
- Autor(en)
- Ilir Hajdini, Josef Windsperger
- Abstrakt
Previous research has not explained the use of real option clause in franchise contracting. The real option clause has two economic functions: To reduce transaction costs by mitigating opportunism risk and to increase strategic rents by exploiting the profit potential from future upside opportunities under uncertainty. We argue that franchisors will more likely use a real option clause in franchise contracts under high behavioral uncertainty, high franchisors’ transaction-specific investments relative to franchisees’ and long contract duration. In addition, by combining transaction cost theory and real option theory, our study provides a new explanation for the impact of environmental uncertainty on the use of ROC in franchise networks by showing that there exists a U-shaped relationship between environmental uncertainty and the franchisor’s use of ROC. Overall, the data from German and Swiss franchise systems provide support of the research model.
- Organisation(en)
- Institut für Business Decisions and Analytics
- Journal
- European Journal of Law and Economics
- Band
- 50
- Seiten
- 313–337
- Anzahl der Seiten
- 25
- ISSN
- 0929-1261
- DOI
- https://doi.org/10.1007/s10657-020-09665-3
- Publikationsdatum
- 2020
- Peer-reviewed
- Ja
- ÖFOS 2012
- 502013 Industrieökonomik, 502054 Entrepreneurship, 505030 Wirtschaftsrecht
- Schlagwörter
- ASJC Scopus Sachgebiete
- Economics and Econometrics, Law, Business and International Management
- Link zum Portal
- https://ucris.univie.ac.at/portal/de/publications/real-options-in-franchise-contracting(b51fc385-92a5-4e7f-b47a-c5ddbaa34c6d).html