A short Slideshare and video on transaction cost theory.

1. Transaction Cost Theory
Transaction costs:
The costs of individual transactions, the cost incurred whenever an organisation
gets someone to do something for them

2. Transaction Cost Theory
Types of Transaction Costs
• Search & Information
• Bargaining & Decision
• Policing & Enforcement
Search & Information:
For example: The cost of determining goods are
available on the market, finding a suitable supplier
which has the lowest price
Bargaining & Decision:
For example the cost of deciding on the purchase
of a component & the cost of negotiating the best
price, drawing up contracts
Policing & Enforcement:
The costs of ensuring the other party sticks to their
terms of the agreement.
For example: The cost of monitoring quality.

3. Transaction Cost Theory
OpportunismBounded Rationality
Factors Impacting
Transaction Costs
Frequency
Uncertainty
Asset Specificity

4. AccountingCollege.co.uk