Transaction Costs In The Vertical Relationship-based Governance Mechanisms To Select The Analysis

This article discusses the building of governance mechanism selection model from the point of view that save the transaction cost. First, it is point out the reason of why we have chosen that topic in the foreword. It is because that in the process of selecting governance mechanism, people always emphasize the analyses and applications about one kind of mechanisms merely, moreover, they are lose sight of that mechanism selection is a dynamic course. For the sake of this resolve this problem, the article develops the research in that view. Next, the second chapter reviews the transaction cost theory and vertical restraint of companies theory. And then, the third chapter points out there are three kinds of governance mechanism in the vertical governance structures and gives the cost compares about those three mechanisms. In succession, the forth chapter demonstrates hybrid structure's unstablity confronting asset specificity and information asymmetry by an uncomplete information game model.The fifth chapter advances a governance mechanism dynamic interpretation that the selecton of governance structure is relevant with an industy or technology life cycle. At last, the conclusion part puts forward the outcome and the shortage.Totally, there should be two innovated points:(1) Demonstrating hybrid structure's unstablity confronting asset specificity and information asymmetry by an uncomplete information game model.(2) Advancing a governance mechanism dynamic selection interpretation that the selecton of governance structure is relevant with an industy or technology life cycle.