Performance impacts of interorganizational cooperation: a transaction cost perspective

Abstract

This study builds on the transaction cost theory to examine the performance effects of interorganizational cooperation and develops an understanding of how different forms of cooperative relationships affect organizational performance within a major service sector, namely the healthcare industry. The authors study, in particular, two cooperative forms applied to hospitals: hospital-based health networks and health systems. An empirical investigation of 382 hospitals in Taiwan shows that interorganizational cooperation exerts positive effects on hospital performance. In addition, health systems have greater positive effects on hospital efficiency than health networks. Furthermore, this study finds that the positive impact of participation in health systems is especially significant for private hospitals, local community hospitals, and hospitals in highly competitive regions. The findings reveal that performance impacts of interorganizational cooperation are contingent on the cooperative arrangements in the healthcare industry.