Holding up General Motors Literature review Example | Topics and Well Written Essays - 2000 words

Holding up General Motors - Literature review Example According to the study findings  the term transactional cost is essential in the effective development of a theoretical framework, upon which is based the prediction of specific economic tasks, as performed by firm-entities. This is in addition to when such economic tasks would also be performed within the prevailing market arena. Critically, this term was essential during his discussion of the ‘costs of utilizing the price mechanism’ in his paper – The Nature of the Firm. He further developed this concept in his later seminal work – The Problem of Social Cost  Ã¢â‚¬â€œ upon which the term referred to the ‘accrued costs of prevailing market transactions.This paper highlights that  Oliver E. Williamson was to greatly popularise the term, through his work – Transaction Cost Economics – that has fundamentally aided in the explanation of a variety of organizational behaviours in the contemporary era. This is founded on the notion of no t only regarding ‘transactions’ as pertaining to ‘buying and selling’, but also other pertinent interactions i.e. informal gift exchanges and daily emotional transactions etc. Further contribution is by Steven Cheung who conceivably regards transaction costs as pertaining to any cost expenditures, which arise because of the existence of organizational-entities or institutions.  Williamson differentiates in his work – The Mechanisms of Governance (1996) –the aspect of Transaction Cost Economics (TCE) from the then dominant ‘neoclassic micro-economics.