Identify the key characteristics of Transaction Cost Economics Essay

Identify the key characteristics of Transaction Cost Economics - Essay Example The transaction costs can be further grouped into coordination along with motivation costs. The motivation costs are said to be comprising of opportunism along with the agency costs. The costs involved in coordination include the costs of searching, coordination of inputs along with the costs of measurement. In the real world, the transaction costs extension across multiple monetary exchanges can be achieved. To achieve these exchanges, some forms of governance frameworks are needed since they will be vital in determining the integrity’s of various transactions (McNutt, 2005). This can be accomplished adequately by using the formal along with informal frameworks to ensure that transactions are carried out in monetary manners. The notion of transaction cost economics stipulates that the other alternative forms of structures that can be utilized for organizing the economic activities are markets along with hierarchies. The concept of TCE additionally suggests that companies requ ire aligning the governance frameworks with their transactional traits. The concept of TCE disagrees with the issue of people making decisions concerning the usage of government frameworks that will maximize the costs associated with transactions. The criterion that is most basically used in organizing the transaction costs involves economizing the total costs involved in their expenses and transactions. Markets whose total costs are high can appropriately use governance frameworks such as hierarchies (Basenko, Dravone, Shanley & Schaefer, 2009). The distinct traits of transactions have been argued to be the specifying of assets, uncertainty and the frequency of the transactions occurring. The trait known as asset specificity means the degree to which investments made on transactions are special to a particular transaction. In case a transaction flops, then the investments will be deemed as below value when utilized in another way. A circumstance of this nature can easily lead to th e establishment of dependencies between the sellers along with buyers of a particular product (McNutt, 2005). This is because the buyers are tied up to the seller and cannot purchase from other sellers in the market. A partner in a transaction who only invests through specialized possessions will be more vulnerable to encounter opportunism. They will be required to carry out specialized efforts aimed at protecting their investments through the implementation, monitoring and enforcement of contractual controls (Basenko, Dravone, Shanley & Schaefer, 2009). An appropriate method of safeguarding against such problems is to apply the policies of vertical amalgamation/integration. This means that a company will have to indulge in the production of goods and services rather than purchase the already manufactured goods in the market. High levels of asset specificity imply that a company has to indulge in internally organizing their production rather than indulge in governing their markets ( Basenko, Dravone, Shanley & Schaefer, 2009). The other trait of a transaction that is known as uncertainty mainly implies that the company will or may face situations which are currently unknown. These conditions could result from different sources such as their environment and behaviors. Uncertainty that comes from the environment refers to the difficulties encountered in

The Palestinian Land Ownership Essay Example | Topics and Well Written Essays - 750 words

The Palestinian Land Ownership - Essay Example Kanafani, Ghassan the author of "Men In the Sun and Other Palestinian Stories" in his story the â€Å"The land of Sad Oranges" says† equates the experiences of the Palestinians to oranges that dry and finally shrivel up. During the upheaval, a civil war was happening in Palestine when Israel declared its independence in 1948 in an attempt to establish an independent Jewish state. The move was inevitable since huge numbers of Jewish immigrants had moved there. The United nation’s bid to partition the land among Palestinians and the Jews were rejected by the Palestinians and the Arabs and this is when the western world joined in to support the Palestinians. Many Palestinians were killed brutally and were forced out of their land leaving behind their homes including the trees, sea, sun and even the cloud. The narrator tells the young boy that, "you and I and others of our age were too young to understand what the story meant from the beginning to the end" (Kanafani 75). Ghassan Kanafani demonstrates to the reader the catastrophic event of the war on the refugees. The author uses the symbol to show how the Palestinians became outcast the life after as refugees. The narrator says "when my glance fell on your fathers face †¦I saw at the same moment the black revolver and beside it an orange" (Kanafani 80). The audience is made to see his father’s face, black revolver and a shrivelled orange all at once. This is Kanafani’s attempt to show the relationship between the politics in Palestine and the possible practical solutions of the problem. In 1948, the Palestinian leadership had tried to liberate the land but it proved hard since the Arab countries did not support them (Farsoun 32).