Contracts, Negotiation, and Learning: An Examination of Termination Provisions
Taking a temporal view of learning in partnerships, we argue that learning to contract from prior relationships can be manifested not only in an increase in the level of contractual detail but also in a decrease in negotiation time for a given level of contractual detail. We analyse the influence th...
Saved in:
Published in | Journal of management studies Vol. 51; no. 3; pp. 379 - 405 |
---|---|
Main Authors | , , , |
Format | Journal Article |
Language | English |
Published |
Oxford
Blackwell Publishing Ltd
01.05.2014
|
Subjects | |
Online Access | Get full text |
Cover
Loading…
Summary: | Taking a temporal view of learning in partnerships, we argue that learning to contract from prior relationships can be manifested not only in an increase in the level of contractual detail but also in a decrease in negotiation time for a given level of contractual detail. We analyse the influence that the length of prior relationships and the detail of termination provisions have on negotiation time, or the time period that it takes for partners to reach a mutually acceptable agreement. We find that: (1) the length of prior relationships has a curvilinear, U‐shaped effect on negotiation time, suggesting the possibility of diverse learning mechanisms as the relationship unfolds; (2) the impact of the detail of termination provisions on negotiation time varies across different types of termination provisions; and (3) it takes a shorter time to negotiate certain types of termination provisions when partners have longer prior relationships. Beyond suggesting the need to investigate the consequences of contractual provisions for collaborators, our study proposes negotiation time as an additional indicator of a learning‐to‐contract effect that complements existing ones. |
---|---|
Bibliography: | ArticleID:JOMS12069 IESE Business School istex:C627856106C31ABD2FE76B63302B323694610253 Spanish Ministerio de Ciencia e Innovación - No. ECO-2011-2322; No. ECO-2011-13361-E ark:/67375/WNG-6JM0525B-K ObjectType-Article-2 SourceType-Scholarly Journals-1 ObjectType-Feature-1 content type line 23 |
ISSN: | 0022-2380 1467-6486 |
DOI: | 10.1111/joms.12069 |