Group process and conflict in system development
Management Science
A transaction cost approach to outsourcing behavior: some empirical evidence
Information and Management
The myths and realities of information technology insourcing
Communications of the ACM
Portfolios of Control in Outsourced Software Development Projects
Information Systems Research
Contracts in Offshore Software Development: An Empirical Analysis
Management Science
A transaction cost model of IT outsourcing
Information and Management
Deploying Common Systems Globally: The Dynamics of Control
Information Systems Research
Competition Among Sellers in Online Exchanges
Information Systems Research
An investigation of factors that influence the duration of IT outsourcing relationships
Decision Support Systems
Journal of Management Information Systems
An Empirical Analysis of Contract Structures in IT Outsourcing
Information Systems Research
Contractual Provisions to Mitigate Holdup: Evidence from Information Technology Outsourcing
Information Systems Research
Validating instruments in MIS research
MIS Quarterly
Client strategies in vendor transition: A threat balancing perspective
The Journal of Strategic Information Systems
Relationship, contract and IT outsourcing success: Evidence from two descriptive case studies
Decision Support Systems
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Although the issue of cost escalation has often been mentioned in the literature on information technology outsourcing (ITO), the mechanisms by which cost escalation occurs in the ex-post stage of contracting has received little attention. Evidence suggests that cost escalation is common in ITO engagements. Drawing on transaction cost economics (TCE), this study examines the determinants of cost escalation in ITO. We propose and test a research model by positing that transaction attributes or characteristics (relation-specific investments, bargaining power and, measurement difficulties) do not affect cost escalation directly, but rather through the mediation of the holdup problem and disputes between the contracting parties. Furthermore, we examine how the multi-sourcing strategy and clan mechanisms, as a soft contracting mode, moderate this mediation. Data from a survey of 132 ITO decisions were analyzed. The results provide good support for the main hypotheses of the study and yield interesting insights about the determinants of cost escalation in ITO arrangements. Both research and practical implications of the results are discussed.