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Surveying the economics of plural modes of organization

August 2019

In: Journal of Economic Surveys

Emmanuel Raynaud, Paula Sarita Bigio Schnaider et Maria Sylvia Macchione Saes

Abstract : 

Why do firms concomitantly rely on more than one organizational arrangement to procure/distribute a given input/product? In this paper, we systematically review and discuss the extensive path undergone by the literature exploring this issue: theso-called plural forms.We address two main questions: how to explain the coexistence (and often the prevalence) of plural forms in many types of businesses? Are plural forms stable or a transitory phenomenon? We describe the most prominent motivations identified in the economics and management literature that drive firms to adopt plural forms and show that their vast majority are related to the mitigation of various types of agency/transaction costs. We also demonstrate that most of the available pieces of empirical evidence suggest the stability of plural forms over time. We conclude by demonstrating the path that has been trailed by the most recent developments.

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