International Journal of Business and Social Science

ISSN 2219-1933 (Print), 2219-6021 (Online) DOI: 10.30845/ijbss

Understanding Organizational Change in Transition Economies: An Organizational Economics Model
Wei Chen, Larry W. Penwell

Organizational change in transition economies is influenced by multiple political, historical, and economics factors not present in established market economies. In addition to previous research on change, this paper proposes an organizational economics approach to organizational change in emerging economies. Based on transaction cost economics and resource based view, cost of change is proposed as a mediator of change, and perceived governmental commitment to transition, new bundles of services, information source diversity, and outsourced activities are proposed as antecedents of cost of change for organizations in emerging economies. The proposed approach has practical implications for government and organizations concerned with long-term development in emerging economies. It may provide useful lens in studying the impact of government policies and new or outsourced activities on organizational change in transition economies.

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