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Behavioral assumptions and theory development: the case of transaction cost economics
Abstract
From a critical realist perspective, I discuss the role played by behavioral assumptions in organization theories, and use transaction cost economics as an illustrative example. Core behavioral assumptions often constitute the foundation of the mechanismic explanations of a theory, and thus should play a pivotal role in theory development. I distinguish between assumption‐based and assumption‐omitted theory testing, and show that empirical research in transaction cost economics has been dominated by assumption‐omitted testing. To establish a solid foundation for a new theory, management researchers should pay more attention to assumption‐based testing. Copyright © 2006 John Wiley & Sons, Ltd.
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“In particular, studies based on archival data often engage in what Tsang (2006: 999) calls ''assumption-omitted testing''; that is, although key behavioral assumptions may be made implicitly or explicitly for the purpose of developing hypotheses, such assumptions are not tested empirically.”
From Global value chains: A review of the multi-disciplinary literature (2020) · cites this paper as Tsang (2006)
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Metadata
- Authors
- Tsang, E. W. K.
- Affiliations
- Wayne State University (US)
- Corresponding author
- Tsang, Eric W. K.
- ORCID
- Tsang, Eric W. K.
- Venue
- Strategic Management Journal
- Publisher
- Wiley
- Published
- 2006-07-31
- Volume
- 27
- Issue
- 11
- Pages
- 999-1011
- ISSN
- 0143-2095 (ISSN-L)
- 1097-0266
- OpenAlex
- W2068914737
- Cited by
- 143
- References
- 90
- Citations by year
- 2026: 1 · 2025: 6 · 2024: 7 · 2023: 3 · 2022: 6 · 2021: 13 · 2020: 13 · 2019: 9 · 2018: 6 · 2017: 11 · 2016: 4 · 2015: 8 · 2014: 8 · 2013: 10 · 2012: 5
- FWCI
- 16.74
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- Strategic Management Journal (publishedVersion)
- Topics
- Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic Theory and Institutions
- Social Sciences › Business, Management and Accounting › Management Information Systems › Outsourcing and Supply Chain Management
- Social Sciences › Sociology and Political Science › Critical Realism in Sociology
- Keywords
- transaction cost economics, behavioral assumptions, critical realism, theory development, organizational theory, management research methodology
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