Managing Contractual Risk Through Organization: Strategic Vs. Consensual Networks

Desrochers, Martin; Fischer, Klaus; Gueyié, Jean‐Pierre

doi:10.2139/ssrn.600003

Cited by 3 publications

(1 citation statement)

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“…They test some hypotheses derived from the model using data for two FC systems (United States' credit unions and Quebec's caisses populaires) operating in societies with similar development but where integration differs markedly. In another paper Desrochers, Fischer and Gueyie (2004) (hereafter DF&G) performs a similar comparison of Quebec and Ontario FC systems. However, both these tests, while indicative and supportive of the model's predictions, are limited by two facts: first, they cannot separate the country effect (related to regulation, tradition, etc.)…”

Section: Introductionmentioning

confidence: 99%

The Power of Networks: Integration and Financial Cooperative Performance

Desrochers

Fischer

2005

Ann Public Coop Econ

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Abstract**: The purpose of this paper is to perform a cross‐country survey of the level of integration of systems of financial cooperatives (FC) and its effect on measures of performance. We develop a classification scheme based on a theoretical framework that builds on published work using transaction cost economics (TCE) to explain integration of large numbers of financial cooperatives into networks. We identify three critical levels of increasing integration we call respectively atomized systems, consensual networks and strategic networks. Further, we test some of the propositions that result from the theoretical framework on an international sample of financial cooperative systems. Based on this analysis we can conclude that: (i) Integration is less (more) important in developing (more developed) countries and for very small (large) financial cooperatives as a determinant of efficiency. However, integration tends to reduce volatility of efficiency and performance regardless of development. (ii) Integration appears to help control measure of managers’ expense preferences that tend to affect performance of FC. (iii) Despite high costs of running hub‐like organizations in highly integrated system, these systems economize in bounded rationality and operate at lower costs than less integrated systems.

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Section: Introductionmentioning

confidence: 99%