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How Relevant is Transaction Cost Economics to Inter-Firm Relationships in the Music Industry?

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Abstract

This paper applies the transaction cost framework to the organisation of product sourcing and development (PS&D) activities within the popular music industry. Two firm types characterise the industry and this particular set of activities; large multinational firms (`majors') and smaller regionally bound companies (`independents'). We find that the Transaction CostEconomies framework of Oliver Williamson (1985, 1999) provides only a partial explanation for the observed hybrid organisational structures established by the two firm types. A more sensitive model can be achieved by including a number of moderating variables drawn from the socially constructed and situationally dependent idiosyncrasies of the assets involved in the PS&D activities under consideration.

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  1. East London Business School, Barking campus, University of East London, Longbridge Road, Dagenham, RM8 2AS, Essex, U.K

    Jonathan Gander

  2. Harrow Business School, University of Westminster, Watford Road, Northwick Park, HA1 3TP, Harrow, U.K

    Alison Rieple

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  1. Jonathan Gander
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Gander, J., Rieple, A. How Relevant is Transaction Cost Economics to Inter-Firm Relationships in the Music Industry?. Journal of Cultural Economics 28, 57–79 (2004). https://doi.org/10.1023/B:JCEC.0000009958.80454.f6

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