A taxonomy of transaction-specific investments and its effects on cooperation in logistics outsourcing relationships

Abstract

ABSTRACTThis study attempts to identify the variations in the transaction-specific investments made in logistics outsourcing relationships and explore how such variations are related to outsourcing cooperation. Based on the assumption that the vendor and the client always make some level of investment in outsourcing relationships, we develop a cluster model that illustrates four situations that indicate varying levels of vendor-specific investment and client-specific investment. We use data from client firms in logistics outsourcing relationships from China to test the theorised configurations through cluster analysis. The results validate our proposed matrix of specific investments and confirm that systematic configurations of the investment taxonomy and corresponding cooperation behaviours of information sharing, joint action, opportunism and conflict exist in each situation.