Which of the following interorganizational linkage mechanisms allows an organization to minimize transaction costs and to avoid bureaucratic costs?
A) Third-party linkage mechanisms
B) Co-optation
C) Merger
D) Keiretsu

Question

Quizplus · Accepted Answer

Keiretsu is a form of interorganizational linkage that allows an organization to minimize transaction costs and to avoid bureaucratic costs. In a keiretsu, a group of companies work closely together, sharing resources and information, and engaging in mutual investments. This allows each company in the keiretsu to achieve economies of scale and to act more efficiently, thus reducing transaction costs. Additionally, because the companies are closely interconnected, they can avoid bureaucratic costs by streamlining their processes and decision-making. In contrast, third-party linkage mechanisms, co-optation, and mergers are not specifically designed to minimize transaction costs and avoid bureaucratic costs.

Which of the Following Interorganizational Linkage Mechanisms Allows an Organization