Agency Costs and Scarce Resources: Influences on Brazilian Franchising
This paper revisits a traditional issue in literature on franchising: the contractual mix (i.e., the proportion between franchised and company-owned stores). We analyze 270 Brazilian chains to better understand the Brazilian scenario. We stress the dynamics of this proportion over time considering...
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| Format: | Article |
| Language: | English |
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FUCAPE Business School
2019-01-01
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| Series: | BBR: Brazilian Business Review |
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| Online Access: | http://www.redalyc.org/articulo.oa?id=123062260005 |
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| author | Eugenio Jose Silva Bitti Vinicius Medeiros Magnani Bianca Thomazella |
| author_facet | Eugenio Jose Silva Bitti Vinicius Medeiros Magnani Bianca Thomazella |
| author_sort | Eugenio Jose Silva Bitti |
| collection | DOAJ |
| description | This paper revisits a traditional issue in literature on franchising: the contractual mix (i.e., the proportion between franchised and company-owned stores). We analyze 270 Brazilian chains to better understand the Brazilian scenario. We stress the dynamics of this proportion over time considering the perspective of monitoring costs and the difficulty of access to resources as possible explanations. Considering the moment of the Brazilian economy, it is pertinent and opportune to investigate the behavior of the chains in times of turbulence. Panel data covering the 2011-2016 period was analyzed through econometric tools. The results corroborate aspects related to monitoring and incentives advocated by the agency theory, that is: costs of monitoring in elevation due to the geographic dispersion induce a greater proportion of franchised stores. In addition, the concept of dispersion is extended to capture socioeconomic aspects of the different regions occupied by the chains. Effects related to restriction to scarce resources are also noted, but in a less unambiguous way. |
| format | Article |
| id | doaj-art-2d5c8627eee14fe58e5ae8db8441be0e |
| institution | Kabale University |
| issn | 1807-734X |
| language | English |
| publishDate | 2019-01-01 |
| publisher | FUCAPE Business School |
| record_format | Article |
| series | BBR: Brazilian Business Review |
| spelling | doaj-art-2d5c8627eee14fe58e5ae8db8441be0e2025-02-06T23:39:32ZengFUCAPE Business SchoolBBR: Brazilian Business Review1807-734X2019-01-0116438339910.15728/bbr.2019.16.4.5Agency Costs and Scarce Resources: Influences on Brazilian FranchisingEugenio Jose Silva BittiVinicius Medeiros MagnaniBianca ThomazellaThis paper revisits a traditional issue in literature on franchising: the contractual mix (i.e., the proportion between franchised and company-owned stores). We analyze 270 Brazilian chains to better understand the Brazilian scenario. We stress the dynamics of this proportion over time considering the perspective of monitoring costs and the difficulty of access to resources as possible explanations. Considering the moment of the Brazilian economy, it is pertinent and opportune to investigate the behavior of the chains in times of turbulence. Panel data covering the 2011-2016 period was analyzed through econometric tools. The results corroborate aspects related to monitoring and incentives advocated by the agency theory, that is: costs of monitoring in elevation due to the geographic dispersion induce a greater proportion of franchised stores. In addition, the concept of dispersion is extended to capture socioeconomic aspects of the different regions occupied by the chains. Effects related to restriction to scarce resources are also noted, but in a less unambiguous way.http://www.redalyc.org/articulo.oa?id=123062260005franchisingcontractual mixagency theoryresource scarcity |
| spellingShingle | Eugenio Jose Silva Bitti Vinicius Medeiros Magnani Bianca Thomazella Agency Costs and Scarce Resources: Influences on Brazilian Franchising BBR: Brazilian Business Review franchising contractual mix agency theory resource scarcity |
| title | Agency Costs and Scarce Resources: Influences on Brazilian Franchising |
| title_full | Agency Costs and Scarce Resources: Influences on Brazilian Franchising |
| title_fullStr | Agency Costs and Scarce Resources: Influences on Brazilian Franchising |
| title_full_unstemmed | Agency Costs and Scarce Resources: Influences on Brazilian Franchising |
| title_short | Agency Costs and Scarce Resources: Influences on Brazilian Franchising |
| title_sort | agency costs and scarce resources influences on brazilian franchising |
| topic | franchising contractual mix agency theory resource scarcity |
| url | http://www.redalyc.org/articulo.oa?id=123062260005 |
| work_keys_str_mv | AT eugeniojosesilvabitti agencycostsandscarceresourcesinfluencesonbrazilianfranchising AT viniciusmedeirosmagnani agencycostsandscarceresourcesinfluencesonbrazilianfranchising AT biancathomazella agencycostsandscarceresourcesinfluencesonbrazilianfranchising |