Beyond the Dyad: Taking Stock and Moving Forward

Abstract: A focus on the transaction or single dyad is traditionally adopted in the study of vertical relationships. While much has been learned from this narrow focus, there is the concern that our understanding remains incomplete since, in practice, it is relatively rare for a dyad to exist in isolation. Rather, most dyads are embedded, interdependent elements of a broader system of interactions. Interconnected exchanges may occur simultaneously, as in the case of franchise systems, project networks, and supply chains or they may occur sequentially as in the case of ongoing research and development programs. In this paper, we review the small body of (TCE-based) literature that moves beyond a dyad perspective towards a systems perspective of contracting. We build from this foundation to highlight key theoretical questions and empirical challenges of, per Williamson (1985: 393) giving “greater attention to the multilateral ramifications of contract.” We close by detailing exploratory empirical studies of interconnected exchanges.