Contractual Form in Domestic and International Strategic Alliances

Abstract

This paper studies the factors that influence the adoption of a contractual form in strategic alliances within a transaction, cost framework. It is argued that joint ventures are preferred to contractual agreements as cooperation becomes increasingly complex. An analysis of 663 strategic alliances has confirmed this proposition while showing the differences that exist between domestic and international alliances. The former are more intensively influenced by variables relative to organizational complexity such as the number of partners and the number of functional areas; the latter being influenced to a greater extent by strategic complexity and the need to learn.