By Jan Sammeck

ISBN-10: 3834935417

ISBN-13: 9783834935410

ISBN-10: 3834935425

ISBN-13: 9783834935427

The thought of self-regulation as an tool in a position to mitigating socially bad practices in industries - reminiscent of corruption, environmental degradation, or the violation of human rights - is receiving significant attention in idea and perform. through impending this phenomenon with the idea of the hot Institutional Economics, Jan Sammeck develops an analytical technique that issues out the severe mechanisms which make a decision concerning the effectiveness of this software. through integrating thought with useful examples of self-regulation, this learn highlights the need to examine the institutional incentives of an undefined, as a way to come to a valid judgement in regards to the feasibility and effectiveness of this device in a given situation.

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Extra info for A New Institutional Economics Perspective on Industry Self-Regulation

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For this purpose, one may distinguish between economic and political transactions of the firm. For example, economic transactions are with customers and suppliers, in which goods and services are exchanged for money. One may consider these primary transactions of a firm, as they directly relate to its purpose, which is to generate profits. Primary transactions are, however,  81 See Greif (2006a, p46). For reasons of perspicuity, it shall be noted that this definition deviates from the classical one of Williamson (1985, p1) for transaction cost economics, namely that “transactions occur when a good or service is transferred across a technologically separable interface”.

G. highly price-sensitive customers. Private action may thus become cost-prohibitive for the individual firm, if the achieved reduction of transaction costs in stakeholder transactions is overcompensated by a competitive disadvantage on the market. By forming an industry-wide commitment, actors seek to make these costs competition-neutral, thus mitigating the impact that costs of compliance with ethical standards have on the maximization of profit, while still securing a reduction of transaction costs in stakeholder transactions.

22 influenced by auxiliary transactions with the same or other opponents, which can be either political or economic in nature. For example, the government’s assurance of loosening or tightening the regulative burden presents a transaction for the affected firm, in that the transaction partner – the government – puts forward a certain demand to the firm. e. demands by law, may significantly influence the costs at which the company is able to sell (and/or produce) in future primary transactions.

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A New Institutional Economics Perspective on Industry Self-Regulation by Jan Sammeck

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