Relational Cost and Organisational Governance

The answer to the question about the nature of the firm is reflected in relation to the economic cost concept of a theory of the firm. In a relational theory of the firm, the concept of relational costs is therefore of fundamental importance. These costs ultimately determine the achievable cooperation corridor of a firm and, consequently, its potential cooperation rents. They reflect the willingness and ability of all involved stakeholders to cooperate. Hence, the organisational and individual learning processes of an organisation and its strategic management are essential. This enables the distinction of the key dimensions of the relational cost concept.