Determination of Contract Duration: An Empirical Study on the Ground Handling Agreements with the View of Transaction Cost Theory

Abstract

The contract duration is seen as an optimization process in which the benefits of the increase in service to be purchased in a buyer-seller relation are balanced between the costs that will arise accordingly (Crocker ve Reynolds, 1993). According to the transaction cost theory, contract duration is a control mechanism that will protect the parties against opportunistic behavior of the other party. According to the theory, when asset specificity or relational investment is increased, the duration of a commercial contract expands but becomes shorter as the uncertainty increases. In this study, it is aimed to explain the determinants of differences in contract duration of ground handling agreements between airlines and ground handling companies by using the variables of transaction cost theory. For this purpose, an empirical study was conducted using 41 ground handling contracts. The relationship between the variables in the research's model was tested with the partial least squares method using the Smartpls 3 program. As a result of the analysis, there was a positively statistically significant relationship between the duration of the contract and the dedicated assets, which is one of the asset specificity types. Unexpectedly, it is concluded that there is a positive relationship between demand uncertainty and contract duration. There was no statistically significant relationship between environmental uncertainty and contract duration. It is concluded that the variables of the transaction cost theory are limited explanatory power in explaining the differences in the duration of the ground handling agreements. 

Keywords

• Transaction cost theory,Contract duration,Airline-ground handling relationship,Smartpls

Sözleşme Süresinin Belirlenmesi: İşlem Maliyeti Teorisi Bakışıyla Yer Hizmeti Sözleşmeleri Üzerine Ampirik Bir Araştırma

Abstract

Sözleşme süresi bir alıcı-satıcı ilişkisinde alınacak hizmette meydana gelecek artışın avantajları ile buna bağlı olarak meydana gelecek maliyetler arasında dengenin sağlandığı bir optimizasyon süreci olarak görülmektedir (Crocker ve Reynolds, 1993). İşlem maliyeti teorisine göre sözleşme süresi, tarafları karşı tarafın fırsatçı davranışına karşı koruyacak bir kontrol mekanizmasıdır. Teoriye göre bir ticari sözleşmenin süresi işlemin varlık özgüllüğü veya ilişkiye özgü yatırımlar arttıkça uzamakta, belirsizlik arttıkça kısalmaktadır (Crocker ve Masten, 1988; Sausser, 1999). Bu araştırmada havacılık sektöründe faaliyet gösteren havayolu işletmeleri ve yer hizmeti işletmeleri arasında imzalanan sözleşmelerin sürelerindeki farklılığın nedenleri işlem maliyeti teorisi değişkenleri aracılığıyla açıklanması amaçlanmıştır. Bu amaçla 41 yer hizmeti anlaşması üzerinden ampirik bir araştırma gerçekleştirilmiştir. Araştırmanın modelindeki değişkenler arasındaki ilişkileri test etmek için kısmi en küçük kareler yöntemi kullanılmış ve analizler Smartpls 3 programı kullanılarak yapılmıştır. Verilerin analizi sonucunda varlık özgüllüğü türlerinden biri olan adanmış varlıklar ile sözleşme süresi arasında istatistiksel olarak anlamlı bir ilişki bulunmuştur. Araştırmada talep belirsizliği ile sözleşme süresi arasında ise negatif yönlü bir ilişki öngörülmüştür ancak talep belirsizliği arttıkça sözleşme süresinin uzadığı sonucuna ulaşılmıştır. Çevresel belirsizlik ve sözleşme süresi arasında ise istatistiksel olarak anlamlı bir ilişki bulunamamıştır. Araştırma modelinin analizi sonucunda işlem maliyeti teorisinin değişkenlerinin yer hizmeti sözleşmelerinin sürelerindeki farklılığı açıklamakta sınırlı bir açıklama gücü olduğu sonucuna ulaşılmıştır.  

Keywords

• İşlem maliyeti teorisi,Sözleşme süresi,Havayolu-yer hizmeti işletmesi ilişkisi,, Smartpls

References

1. Albers, S., Koch, B., & Ruff, C. (2005). Strategic alliances between airlines and airports: Theoretical assessment and practical evidence. Journal of Air Transport Management, 11(2), 49-58.
2. Bandiera, O. (2007). Contract duration and investment incentives: Evidence from land tenancy agreements. Journal of the European Economic Association, 5(5), 953-986.
3. Beulen, E., & Ribbers, P. (2002). Managing complex IT outsourcing-partnerships. Proceedings of the 35th Annual Hawaii International Conference. Big Island, HI, USA: IEEE
4. Brickley, J. A., Misra, S., & Van Horn, R. L. (2003). Contract duration: Evidence from franchise contracts. Simon School of Business Working Paper No. FR 03-08.
5. Bükeç, C. M. ve Çelik, D. (2010). 11 Eylül sonrası dönemde havacılıkta güvenlik ve işbirliği anlayışındaki değişim. 3. Ulusal Havacılık ve Uzay Konferansı. Eskişehir, Türkiye.
6. Cannon, J. P., Achrol, R. S., & Gundlach, G. T. (2000). Contracts, norms, and plural form governance. Journal of the Academy of Marketing Science, 28(2), 180-194.
7. Chin, W. W. (1998). Commentary: Issues and opinion on structural equation modeling. MIS Quarterly 22(1),vii-xvii.
8. Cohen, J. (1988). Statistical power analysis for the behavioral sciences. Hillsdale: Erlbaum Associates.

9. Crocker, K. J., & Masten, S. E. (1988). Mitigating contractual hazards: Unilateral options and contract length. The RAND Journal of Economics 19(3), 327-343. Crocker, K. J., & Reynolds, K. J. (1993). The efficiency of incomplete contracts: An empirical analysis of air force engine procurement. The RAND Journal of Economics 24(1), 126-146.
10. Demir, E. (2015). Rusya’nın yaptırımlarının Türkiye ekonomisine olası etkileri. Bilgi Notu, Türkiye İş Bankası, İktisadi Araştırmalar Bölümü, İstanbul.
11. DHMİ, 2018. http://www.dhmi.gov.tr/
12. DHMİ Uçuş İstatistikleri. Erişim tarihi: 17.01.2917, http://www.dhmi.gov.tr/istatistik.aspx
13. Fleta-Asín, J., & Muñoz, F. (2017). Determinants of contract duration in outsourced services in the defense sector. Applied Economics Letters 24(19), 1-4.
14. Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. Journal of Marketing Research, 39-50.
15. Fuhr, J. (2007). Contractual design and functions–evidence from service contracts in the European air transport industry. Working paper series no 2007–03: Center for Network Industries and Infrastructure.
16. Gorovaia, N., & Windsperger, J. (2018). The choice of contract duration in franchising networks: A transaction cost and resource-based view. Industrial Marketing Management, 1-9.
17. Gottschalk, P., & Solli-Sæther, H. (2006). Managing successful IT outsourcing relationship. Hershey: IRM Press.
18. Gurcaylilar-Yenidogan, T., & Windsperger, J. (2015). Complementarity between formal and relational governance mechanisms in inter-organizational networks: combining resource-based and relational governance perspectives. Interfirm Networks (pp. 229-248): Springer.
19. Hair Jr, J. F., Hult, G. T. M., Ringle, C., & Sarstedt, M. (2016). A primer on partial least squares structural equation modeling (PLS-SEM). London: Sage Publications.
20. Heide, J. B., & John, G. (1992). Do norms matter in marketing relationships? The Journal of Marketing. 56(2), 32-44.
21. Hendrikse, G., Hippmann, P., & Windsperger, J. (2015). Trust, transaction costs and contractual incompleteness in franchising. Small Business Economics, 44(4), 867-888.
22. Henseler, J., Ringle, C. M., & Sarstedt, M. (2015). A new criterion for assessing discriminant validity in variance-based structural equation modeling. Journal of the Academy of Marketing Science, 43(1), 115-135.
23. Henseler, J., Ringle, C, M., & Sinkovics, R. (2009), The use of partial least squares path modeling in international marketing. Sinkovics, R. & Ghauri, P. (ed.) New Challenges to International Marketing, 277 - 319: UK, Emerald Group Publishing Limited.
24. Hirst, M. (2008). The air transport system. Cambridge: Woodhead Publishing Limited.
25. ICAO, 2000. Ground handling at airports. Conference on the Economics of Airports and Air Navigation Services, Montreal: International Civil Aviation Organisation. Erişim tarihi: 01.12.2917, https://www.icao.int/Meetings/ansconf2000/Documents/wp10e.pdf
26. Jiang, M. S., Chu, R., & Pan, Y. (2011). Anticipated duration of international joint ventures: A transaction cost perspective. Journal of International Management, 17(2), 175-183.
27. Joskow, P. L. (1987). Contract duration and relationship-specific investments: Empirical evidence from coal markets. The American Economic Review, 77(1), 168-185.
28. Kalemci, R. A. (2017). İşlem maliyeti kuramı. Sözen, H. C. ve Basım, H. N. (ed). Örgüt Kuramları, İstanbul: Beta Basım.
29. Kalemci, R. A. (2013). İşlem maliyeti kuramının davranışsal varsayımlarında güvenin yeri tartışması. İş Ahlakı Dergisi, 6(2), 55-83.
30. Kerkvliet, J., & Shogren, J. F. (2001). The determinants of coal contract duration for the Powder River Basin. Journal of Institutional and Theoretical Economics JITE, 157(4), 608-622.
31. Kozhevnikova, M., & Lange, I. (2009). Determinants of contract duration: Further evidence from coal-fired power plants. Review of Industrial Organization, 34(3), 217-229.
32. López-Bayón, S., & González-Díaz, M. (2010). Indefinite contract duration: Evidence from electronics subcontracting. International Review of Law and Economics, 30(2), 145-159.
33. Masten, S. E., & Saussier, S. (2000). Econometrics of contracts: An assessment of developments in the empirical literature on contracting. Revue D'économie Industrielle, 92(1), 215-236.
34. Poppo, L., & Zenger, T. (2002). Do formal contracts and relational governance function as substitutes or complements? Strategic Management Journal, 23(8), 707-725.
35. Rindfleisch, A., & Heide, J. B. (1997). Transaction cost analysis: Past, present, and future applications. The Journal of Marketing, 61(4), 30-54.
36. Ringle, C. M., Sarstedt, M., & Straub, D. (2012). A critical look at the use of PLS-SEM in MIS Quarterly. MIS Quarterly, 36(1), iii-xiv.
37. Ringle, C. M., Wende, S., & Becker, J.-M. (2015). SmartPLS 3. Boenningstedt: SmartPLS GmbH, http://www. smartpls. com. Lisans number: RREQ9-DQPAG-G4BES-X4GKG-56SAH-LIQYA-A99E2-ASEAY-X79JZ-U5G3Y-IA2TI
38. Saussier, S. (1999). Transaction cost economics and contract duration: An empirical analysis of EDF coal contracts. Recherches Économiques de Louvain/Louvain Economic Review, 65(1), 3-21.
39. SHGM, 2018. Yer Hizmeti Kuruluşları. Erişim tarihi: 02.06.2018, http://web.shgm.gov.tr/documents/sivilhavacilik/files/pdf/havacilik_isletmeleri/yer_hiz_kuruluslari.pdf
40. Shelanski, H. A., & Klein, P. G. (1995). Empirical research in transaction cost economics: A review and assessment. Journal of Law, Economics, & Organization, 11(2), 335-361.
41. SHY-22, 2016. Yer Hizmetleri Yönetmeliği. Erişim tarihi: 17.12.2017, http://www.resmigazete.gov.tr/eskiler/2016/08/20160823-3.htm
42. SYHA, 2008. Standart yer hizmetleri anlaşması. Sivil Havacılık Genel Müdürlüğü Yayınları, Ankara: Elit Matbaacılık.
43. Simon, H. A. (1957). Models of man: Social and rational: Mathematical essays on rational human behavior in a social setting. New York: Wiley.
44. Tang, M.-C. (2015). Contract length, expected surplus, and specific investments: Empirical evidence from the national football league. Journal of Sports Economics, 16(3), 295-311.
45. Vazquez, L. (2007). Determinants of contract length in franchise contracts. Economics Letters, 97(2), 145-150.
46. Vroman, S. B. (1989). Inflation uncertainty and contract duration. The Review of Economics and Statistics, 677-681.
47. Wallace, F. H. (2001). The effects of shock size and type on labor-contract duration. Journal of Labour Economics, 19(3), 658-681.
48. Williamson, O. E. (1979). Transaction-cost economics: The governance of contractual relations. Journal of Law and Economics 22(2), 233-261.
49. Williamson, O. E. (1981). The economics of organization: The transaction cost approach. American Journal of Sociology, 87(3), 548-577.
50. Williamson, O. E. (1985). The economic institutions of capitalism. New York, NY: Simon&Schuster Inc.
51. Williamson, O. E. (1996). The mechanism of governance. New York, NY: Oxford University Press Inc.
52. The Worl Bank Report, 2017. Political Stability Index. Erişim tarihi: 10.10.2017, https://www.theglobaleconomy.com/Turkey/wb_political_stability/