Contractual Alliance Governance: Impact of Different Contract Functions on Alliance Performance

Recent research on alliance governance has emphasized that contracts can have both a control and coordination function. In this paper, we test the impact of these different contract functions on alliance performance. Conducting structural equation analyses on a sample of 270 Dutch technology alliances, we disentangle the relationship between different contract functions, partner cooperation and alliance success. Our data show that different contract roles have a different impact on partner cooperation within the alliance. In addition, we find strong indications that the presence/absence of prior trustful collaboration and the number of alliance partners moderate the relationship between contract functions and partner cooperation. Finally, our data provide evidence that contract functions indirectly influence alliance success via partner cooperation.