Table Of ContentМАКРОЭКОНОМИКА
Problems of optimization transaction costs to the formation
of international economic agreements
V.V. Matveev,
канд. экон. наук, проф., Директор Института экономики и менеджмента, Национальный авиационный
университет (03680, Украина, г. Киев, пр. Космонавта Комарова 1; e-mail: [email protected])
V.S. Novyk,
аспирант, Национальный авиационный университет (03680, Украина, г. Киев, пр. Космонавта Комарова 1; e-
mail: [email protected])
Аннотация. В данной статье исследованы и предложены некоторые направления оптимизации
трансакционных издержек при формировании международных экономических соглашений на основе раз-
личных методов. К трансакционным издержкам мы отнесли: издержки поиска и измерения, издержки
ведения переговоров, расходы составления контракта, расходы мониторинга, затраты на принужде-
ние, затраты на защиту прав собственности и агентские затраты. Мы показали, что система ме-
тодов оптимизации трансакционных издержек при формировании международных экономических со-
глашений может положительно влиять на эффективность бизнеса.
Abstract. In this article researchedand suggested some optimization ways of transaction coststhe for-
mation of international economic agreements based on difference methods.By transaction costs we carried:
search costs and measuring, the costs of negotiation, contract preparation costs, the costs of monitoring, en-
forcement costs, the cost of property rights, and agency costs.
Ключевые слова: международные экономические соглашения, трансакционные издержки, оптими-
зация расходов.
Keywords: international economic agreements, transaction costs, costs optimization.
Problem statement.Transaction costs are tion of the market.To the extent that administrative
an obstacle to mutually beneficial exchange.In this control mechanisms leads to savings on transaction
regard, raises the question of research methods to costs, «hierarchy» displaces market.As part the firm
minimize transaction costs and ensure their distribu- reduced search costs, eliminates the need for the
tion so that voluntary exchange is made possible. continuous renewal of contracts, economic relations
Variety of transaction costs and makes a variety of become resistant.In other words, in a world without
methods to optimize the costs. That is why the prob- transaction costs, the firm would have been super-
lem of optimizing transaction costs are at the center fluous.
of attention of many scholars. One should hardly have to tell academicians
Analysis of recent publications.The prob- that information is a valuable resource: knowledge
lem of transaction costs and their optimization is is power. Prices change with varying frequency in all
investigated by such scholars:George Akerlof, markets, and, unless a market is completely central-
Armen A. Alchian, Harold Demsetz, ized, no one will know all the prices which various
ThrainnEggertsson, Kenneth Arrow, sellers (or buyers) quote at any given time. A buyer
RostislavKapeliushnikov, Gavin Kennedy, Ronald (or seller) who wishes to ascertain the most favora-
Coase, ViacheslavMatveev, Paul Milgrom,James ble price must canvass various sellers (or buyers),
Mirrlees, Douglass C. North, John Roberts, Joseph and this phenomenon is called «Search» [2, p.213].
Stiglitz, George Stigler, VitaliTambovtsev, Oliver E. To minimize the costs of information search
Williamson, Steven N. S. Cheung, Andrey Shastitko, reasonable prices, find information about available
Oksana Shepelenkoand other[1-19]. products and services, search information about
The purpose of the publication is research sellers or buyers using institutions such as special-
and the development of methods of optimizing ized markets, in particular stock exchange, as well
transaction costs when shaping international eco- as advertising or reputation. As for organized mar-
nomic agreements. kets, the cost savings made possible by the concen-
Main material.The presence of any costs, of tration of supply and demand.As a result of acceler-
course, encourages search for methods that would ated circulation of information and more intensive
have reduced them.This statement applies, of alignment of the prices [3, p.236].
course, and transaction costs.One of these optimi- Verification of the counterparty (as one of the
zation methods of transaction costs – organization moments of the search process) also requires time
of firms. Firms, according to Ronald Coase[1, and resources. It is necessary in order to reduce the
p.386], arise in response to the high cost of market risk of opportunistic behavior of the counterparty
coordination.Their meaning in the suppression of after the transaction. Reputation is closely connect-
the price mechanism and replace its system of ad- ed with the business of identity, in particular the
ministrative control.Indeedmuch cheaper to carry trade names, trademarks, service marks and appel-
out transactions within the firm, without the media- lations of origin. It is these tools allow contractors to
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V.V. Matveev, V.S. Novyk Problems of optimization transaction coststo the formation of international economic agreements
save on costs search.The more powerful is the portant than knowing your customer. As well as
trademark as a source of information, the greater questioning the client, the firm should conduct sur-
the cost savings search, the higher, all other things veys competitor. The value of this method is that
being equal, may be the price, which appoints the you can work out the tactics and strategy firm be-
seller [3, p.238].For example, top best brands in the havior.
world: Apple, Google, Microsoft, IBM, Walmart, As you know, the more developed in detail
Samsung, GE, Coca-Cola, Vodafone, AT&T, Veri- the contract, the lower the probability of opportunis-
zon, HSBC, NTT Group, Toyota, Wells Fargo, Bank tic behavior (all other things being equal).In this
of America, McDonald’s,Shell [4].In Singapore, such case, the assumption of minimum cost to produce a
a sequence values of the brand as: Singapore Air- court order and its execution. Therefore, this meth-
lines, Wilmar, DBS, Genting Singapore, SingTel od in practice is very efficient.
[5].Reputation and the value of a trademark is often Under current conditions, with the rapid de-
associated with such economic terms as goodwill. velopment of information technology, we cannot
There are three categories of goods: re- forget about the use of IT technology is certainly not
searched, experienced and trustworthy. The bene- bad, too, can optimize transaction costs of commu-
fits of a high cost to measure the quality of their pur- nication between partners. We should not forget
chase (consumption) are the experienced (experi- also about the use of NLP technologies in negotia-
ence). The benefits of a relatively cheap procedure tions [13]. This method supports the success of
prior determination of their quality called researched many international companies. In order to optimize
(search). Quality of the latter can be relatively easily the cost of the stage for an international agreement
assessed before purchase, as other quality – in the can use new technologies and devices. For exam-
process of consumption. For trust (credence) goods ple: digital signature, tablet PCs, etc.
have high quality measuring costs as ex ante, and Externalization of modern business and the
ex post. Cost optimization quality measurement can development of its outsourcing help reduce the
take place by means of standardization of goods transaction costs of the enterprise. In the process of
and services. For example, if a buyer purchases an outsourcing transaction costs are reduced through
orange, the cost of measurement in relation to its the transfer of certain domestic operations inde-
cost is too high. However, if we assume that the pendent economic entities. Essentially, it is shifting
standard orange, then when you buy ten pounds to other entities own transaction costs, thereby in-
can eat an orange for the evaluation of the entire creasing the profitability of the business[8,
party. As a means to reduce the transaction costs p.162].Oliver E. Williamson examines outsourcing
associated with the measurement of the quality of from the perspective of the theory of transaction
goods exchanged (and the search for a partner with costs.Because the transaction serves as the basic
the right products) use the money as a common unit of analysis, and the decision to purchase in the
medium of exchange (protected by tradition, cus- format of choice between independent production of
tom, or the economic power of the state)[3, p.241]. the product (service) and the purchase of an exter-
Brand names also a method of optimization nal supplier made taking into account the principle
of costs, as they not only show as a commodity, but of economy of transaction costs, the simplicity of
also give the buyer the opportunity to take appropri- contracts varies depending on the characteristics of
ate action if the quality of the goods does not meet transactions, with particular value provided that the
expectations, simply will not buy more products from source of added value continuity conservation rela-
this company. Licensing practices reduces uncer- tions between specific buyers and sellers.The basic
tainty and improves the quality of transaction costs. pattern is that with the increasing dependence of
Any qualified person is a document that attests to bilateral counterparty is a gradual development of
the level of his training. Diploma from a higher edu- effective management of the contractual relationship
cation institution, degree, even to some extent the of the parties, the starting point of which is a simple
Nobel Prize – all this kind of quality certificates[6, market exchange, developing into a hybrid type con-
p.500]. tract (with support for the reliability of the commit-
As you know the conditions of the develop- ments) and ends, in turn, hierarchy.It corresponds to
ment agreement, agreement between the parties as the solution of the «self-producing» that the review
they require time and resources. Therefore, one of from the standpoint of the theory of transaction
the most important ways to reduce transaction costs costs is the organizational form of last resort
is a systemic accumulation of information about [9].Now outsourcing external executor can be trans-
potential customers, competitors, groups of Strate- ferred almost all functions of the company.The most
gic Influence, which can be considered as potential common option of outsourcing is the transfer of
partners for market transactions and thus can signif- functions: accounting and tax calculation; legal sup-
icantly reduce transaction costs, to prevent unfavor- port; payroll staff; staff management; information
able conclusion of contracts and agreements, as systems and database management; marketing
well as prevent negotiations with obviously negative communications and public relations; project man-
results. International experience suggests that fail- agement from design to implementation; issues of
ure of this function leads to a significant increase in economic and information security; logistics man-
transaction costs. Especially important method, in agement and delivery; production; assembly and
our opinion, is the study of current and potential testing; cleaning and maintenance; transportation
competitors. Know your competitor is no less im- management and its maintenance [8, p.163].Of out-
Экономика и предпринимательство, № 7, 2013 г.
61
МАКРОЭКОНОМИКА
sourcing can be attributed to the formation of the to register in the contract procedure for its revision.It
third phase of international economic agreements, should be emphasized that the provision of goods
using this method can optimize the cost of mainte- and services guarantees too acts by optimizing op-
nance contract. portunistic costs.
One of the methods of optimization of trans- It is generally recognized that one of the
action costs is the use of factoring.According most fundamental obstacles to successful economic
toOksana Shepelenko, factoring transaction allows development is the low protection of property rights.
the company-seller refinance most of receivables The participants of the market provides incentives to
from the buyer provide credit in the short term, re- devote significant resources to protect «their» and
ducing the period of the financial and operating cy- capture «foreign» assets.This results in economic
cle.The disadvantages of factoring operations in- losses [11, p.150].Costs specification and protection
clude only incremental costs seller relating to sales of property rights include the cost of the mainte-
of products related to the transaction, and the loss nance of courts, arbitration, the time and resources
of direct contacts (and related information) with a needed to restore damaged in the course of the
buyer in the course of his payments [10, p.212]. contract rights, as well as losses from bad specifica-
AndreyShastitko[3, p.253] in his scientific tion of property rights protection and unrelia-
work has shown that one of the best ways to save ble.Methods for optimizing these costs include such
on the costs of enforcing the rules, particularly in as: effective control of property rights, the optimiza-
contracting is an ideology.Formation of the field of tion of distribution of property rights, a reference to
interaction (in the form of a common language, cul- the long-term working relationships with contractors,
ture, etc.) generates positive network externality, establishing trust partnerships, risk insurance, etc.
which greatly facilitates the exchange activities be- In our opinion the main threats to the implementa-
tween economic agents.Sometimes tradition, in- tion of the contracts are: the increase in the cost of
grained in the community, can reduce the «friction» the project, the increasing the period of implementa-
in the economy.We can provide an interesting ex- tion, lack of predictability, loss of control over the
ample in this respect Japan.Local businessmen pay implementation, the hidden form of privatization,
much attention to the personal relationship between financial losses.The main reasons for the revision of
the partners.Preference is given to compromise is the contract during the implementation phase are:
always more than confrontation.Therefore, during contractual incompleteness, asymmetric infor-
negotiations, the parties do not usually resort to mation, which has partners, opportunism partner
lawyers.As a result, liability for judicial mechanisms andattempt to modify the contract.Methods optimize
in Japan is much lower than in other developed risk of contract renegotiation are: from the start as
countries.For example, in terms of lawsuits per capi- clear and detailed specification of the project, the
ta U.S. ahead of Japan in 20 times. requirement to provide regular information on the
The use of mediation helps resolve dis- performance of the contract, the regular audit part-
putes.This method consists in the fact that the con- ner, the impact on the reputation of the partner.
ciliator (mediator) in the event of any dispute on who Optimization of the organizational structure
helps the parties to the conflict to establish a com- of the company acts as a well-established method
munication process and analyze the conflict situa- for optimizing any transaction costs. It should be
tion so that they could select the variant solutions noted that the strategy of reducing transaction costs
that would meet the interests and needs all parties is not always to be aimed directly at saving costs for
to the conflict, without resorting to the problems in the preparation and conclusion of the transaction.
bankruptcy court. The principal is to ensure the effectiveness of these
It is known that can be considered opportun- expenditures. Central to the strategy to reduce
istic behavior that is aimed at achieving the objec- transaction costs is to prevent potentially inefficient
tives of the entity's own and is not limited by consid- of transaction costs.
erations of morality.The basis of opportunistic be- We should not forget that one of the main
havior is the divergence of economic interests, due methods of optimizing transaction costs is the stabil-
to limited resources, uncertainty.In terms of the con- ity of the company.
tractual process can be divided into two types of The authors constructed a figure 1, called
opportunistic behavior: before signing the contract «Methods of optimization transaction costs when
and after contract signing [3, p.253]. shaping international economic agreements» in
In the study of the problems of opportunistic which systematized methods investigated in this
behavior, special attention should be paid to the scientific paper.
issue of asymmetry of information available. Conclusions.Based on the foregoing, we
ThatGeorge Akerlof [6, p.488] in their research can concludethat optimization or minimization of
wrote how it arises. He noted that to minimize these transaction costs at all three stages of international
costs need to use methods such as vertical integra- economic agreements by different methods is an
tion, additional contractual arrangements and in- effective way to facilitate the exchange of values
vestment in joint assets. and reducing losses of any company.Applying the
In order to «neutralize» the most opportunis- methodology developed by the author in this scien-
tic minded future parties to the agreement must: tific article can actually increase the effectiveness of
strictly define penalties and procedures for with- any organization.Further research in this context is
drawing the rights, powers, and from the beginning relevant.
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V.V. Matveev, V.S. Novyk Problems of optimization transaction coststo the formation of international economic agreements
Figure 1: Methods of optimization transaction costs when shaping international economic agreements.
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