Wow! eBook
Economics and Management of Networks: Franchising, Strategic Alliances, and Cooperatives 2007th Edition
Author(s): George Hendrikse (Editor), Mika Tuunanen (Editor), Josef Windsperger (Editor), Gérard Cliquet (Editor)
- Publisher: Physica
- Publication Date: 8 Jan. 2007
- Edition: 2007th
- Language: English
- Print length: 473 pages
- ISBN-10: 9783790817577
- ISBN-13: 9783790817577
Book Description
Previous research on the institutional structure of franchising networks (Bri- ley et al. 1991; Lutz 1995; Shane 1998; Lafontaine and Shaw 1999, 2005; – fuso 2002; Penard et al. 2003a,b) does not explain the governance structure of the franchising firm as an institutional entity that consists of two interrelated parts: Residual decision rights and ownership rights. The latter includes not only residual income rights of franchised outlets but also residual income rights of franchisor-owned outlets. Previous studies primarily examines the incentive, signalling and screening effects of fees, royalties and other contractual pro- sions from the point of view of organizational economics (see Dnes 1996 for a review) without taking into account the interactions between residual decision and residual income rights as interrelated parts of the governance structure. This paper fills this gap in the literature. According to the property rights view, de- sion rights should be allocated according to the distribution of intangible kno- edge assets between the franchisor and franchisee and ownership rights should be assigned according to the residual decision rights. Since ownership rights are diluted in franchising networks, the dilution of residual income rights of fr- chised outlets is compensated by residual income rights of company-owned o- lets. Under a dual ownership structure, company-owned outlets compensate the disincentive effect of low royalties for the franchisor, and low royalties strengthen the investment incentives for the franchisee.
Editorial Reviews
From the Back Cover
The design and management of networks have become very important research topics in the field of organizational economics and management in the last decade. First, the book emphasizes research in economics and management of networks as a theory-driven field by offering new theoretical perspectives on governance structure issues in franchising, alliances, venture capital relations and cooperatives. Second, the book presents new research results on efficiency and performance of franchising networks and joint ventures, as well as on entrepreneurship and strategic issues in franchising and cooperatives.
