Table 1a.

Key theoretical perspectives on dyadic contracting.

S. No.	Concept	Reference	Comments	Contracts perspective - advantages and limitations
1	a) Homo-economicus' -Self-interested, independent goals, and utility maximizing behaviour b) New institutional economics perspective	a) Adam Smith 1776 b) Williamson 1975, 1981 c) Schneider 1974	1. Firm needs to invest in stakeholders (in relationships with those who have stake in the firm) 2. Investors are not the only stakeholders 3. The approach identifies specific stakeholders who directly engage with the firm (Johnson et al., 2005; Mitchell et al., 1997).	1. Transaction cost Economics - takes perspective of self-interested actors (agents) who are opportunistic and managers (owners) who have bounded rationality* 2. TCE identifies three dimensions a. Asset specificity (safeguarding problem), b. Behavioural uncertainty (performance evaluation problem), c. Environment uncertainty (Adaption problem)* 3. While the theory is helpful in transactional contracts analysis (dyadic relationships)- but leaves human relational aspects 4. Sustainability principles, a wider stakeholder perspective, or network perspective is missing
1a.	The notion is considered: 'Under socialized concept of man'	a) Baker 1983 b) Granovetter 1985 c) Coleman 1988	a) Even in highly rationalized markets (Chicago Options Exchange), "relations are maintained and affect trade" b) Institutional economics is criticised as "crudely functionalist" - as the function of an institution is assumed to defined only by the function it performs	Scholars point to the limited perspective of 'rational individual' acting with 'profit motives' (single dimension) perspective
2	Notion of 'Embeddedness'	a) Granovetter 1985 b) Mcaulay 1963 c) Lohr 1982	a) Isolating economics from interfirm exchange behaviour is not realistic b) Over time trust-building is likely and important for interfirm relationships c) Recourse to legal options destroys future exchange relationships d) Japanese business stress relationship building - transactions are clearly embedded in relationships (a competitive advantage)	1.While the notion of embeddedness provides us with basis for social networks in which firms are embedded. 2. Network of other actors (suppliers, customers, employees, etc. and non-human actors) could also be considered by extending this notion. 3.The notion is a fundamental element of sustainability principles and sustainable contracts, but a direct link to sustainable contracts is not made.
3	Notion of 'Social capital': SC	a) Coleman 1988; 1990 b) Nahapiet and Ghoshal 1998	a) Function - the value of social structures that could be leveraged b) Environmental trustworthiness is important to ensure social capital c) Effective norms could serve as social capital	1. From sustainable constricts perspective, a network coordinator could build social capital that would help create legitimacy and influence which would be critical to implementing sustainable contracts* 2. A direct link to sustainable network contracts is not made
4	Notion of 'Relational exchange': RE	a) Mcneil 1978, 1980 b) Dwyer, Shurr, Oh 1987	a) Relationship more important than the transaction b) Transaction is seen embedded in exchange relationship	1. RE perspective is critical so sustainable contracts, though a direct link to sustainable contracts in networks is not made - development/testing limited to dyadic relationships. 2. Sustainability principles require linking with wide spectrum of stakeholders who may not appear to be directly connected to the transaction. 3. Helps reduce transaction costs*
5	The commitment-trust theory: CTT	a) Morgan and Hunt 1994 b) Moorman, Zaltman, Deshpande 1992 c) Moorman, Deshpande, Zaltman 1993	a) Trust influences relational exchange (Speckman 1979); it influences relationship commitment b) Trust as defined highlights the importance of confidence on part of the trusting party (Rotter 1967) c) Relationship cost and benefits affect commitment; shared values directly influence trust and commitment; communication and opportunistic behaviour	1. While CTT assumes trust and commitment develop over time, it is essential for strategic relationship and for sustainable relationships (long-term and productive relationships) 2. Essential even for short-term contracts; 3. Theory development/testing generally limited to dyadic relationships and sustainable network contracts are not discussed.
6	Notion of 'Shared values': SV	a) Morgan and Hunt 1994 b) Dwyer, Schurr, Oh 1987 (p. 21) c) Moorman, Deshpande, Zaltman 1993	a) Takes time to build relationship between firms and develop shared norms b) Typically developed between partners that have close relationship	1. SV and related norms take time to develop; development/testing limited to dyadic relationships. 2. Shared norms related to sustainability principles would be essential to sustainable network contracts and would support such efforts.