Contractual and Relational Governances: Are they Complementary or Substitutable in the Context of Value Chains

Mulugeta D. Watabaji, Adrienn Molnar


Interactions among value chain actors can be governed either through contractual or relational governance mechanisms or through the use of both at the same time. The question of complementarity or substitutability of these two governance mechanisms has already attracted the attentions of researchers nowadays. This essay is the review of selected scientific journals in the area of contractual and relational governance mechanisms. The purpose is to compile the research findings in a way it assists readers to better understand whether contractual and relational governance mechanisms are complementary or substitutable.

Keywords: contractual governance, relational governance, complementary, substitutability

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