Contracts, norms, and plural form governance

  • Joseph P. Cannon
  • Ravi S. Achrol
  • Gregory T. Gundlach


The organization of interfirm exchanges has become of critical importance in today’s business environment. Many scholars have criticized the inadequacies of legal contracts as mechanisms for governing exchange, especially in the face of uncertainty and dependence. Other scholars argue that it is not the contracts per se but the social contexts in which they are embedded that determine their effectiveness. This study investigates the performance implications of governance structures involving contractual agreements and relational social norms, individually and in combination (plural form) under varying conditions and forms of transactional uncertainty and relationship-specific adaptation. Hypotheses are developed and tested on a sample of 396 buyer-seller relationships. The results provide support for the plural form thesis—increasing the relational content of a governance structure containing contractual agreements enhances performance when transactional uncertainty is high, but not when it is low. Implications for theory and future research are discussed.


Governance Structure Plural Form Exchange Partner Contractual Agreement Transaction Cost Theory 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


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Copyright information

© Academy of Marketing Science 2000

Authors and Affiliations

  • Joseph P. Cannon
    • 1
  • Ravi S. Achrol
    • 2
  • Gregory T. Gundlach
    • 3
  1. 1.Colorado State UniversityUSA
  2. 2.George Washington UniversityUSA
  3. 3.University of Notre DameNotre DameUSA

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