Renger Philemon Kanani The effect of processor control on Screening Transaction Costs in farmer – food processor relationships: An investigation of antecedents and contingency factors PhD theses in Logistics 2016:5 The Effect of Processor Control on Screening Transaction Costs in Farmer – Food Processor Relationships: An Investigation of Antecedents and Contingency Factors Renger Philemon Kanani A dissertation submitted to Molde University College – Specialized University in Logistics For the degree of Philosophiae Doctor (PhD) PhD theses in Logistics 2016:5 Molde University College – Specialized University in Logistics Molde, Norway 2016 Renger Philemon Kanani The effect of processor control on Screening Transaction Costs in farmer – food processor relationships: An investigation of antecedents and contingency factors © Renger Philemon Kanani 2016 PhD theses in Logistics 2016:5 Molde University College - Specialized University in Logistics P.O.Box 2110 NO-6402 Molde, Norway www.himolde.no This dissertation can be ordered from Molde University College Library [email protected] Printing: Molde University College ISBN-13: 978-82-7962-212-3 ISSN: 0809-9588 ii Preface This scholarly work puts empahasis on the factors that moderate the effect of processor control and Screening Transaction Costs. It has been submitted to the faculty of Logistics at Molde University College; Specialized University in Logistics for the partial fulfilment of the degree of Doctor of Philosophy in Logistics. This PhD thesis started in August 2011, and it has been supervised by Professor Arnt Buvik as the main supervisor and Professor Judith Molka Danielsen as co-supervisor. The doctoral degree including this PhD thesis were financed by the Norwegian Government through Quota scheme The committee of three experts has evaluated this PhD thesis: (1) Associate professor Berit I. Helgheim from Molde University College; Specialized University in Logistics, Molde, Norway; Professor Sven Arne Haugland from the Norwegian School of Economics (NHH), Bergen, Norway; Professor Rodney L. Stump, Towson University, Maryland, USA. iii Dedication This PhD thesis is dedicated to my late parents Philemon and Bernadetha Kanani, for instilling me with the culture of reading books at a young age. To my beloved wife and friend Valentina Martine, for her exceptional care and love, and to my beloved daughters: Jahdiela - Bernadette and Davinia. iv Acknowledgement Special thanks go to my main supervisor, Professor Arnt Buvik for encouraging me to do a PhD at a time where I was still questioning by ability to pursue such a risky and demanding journey. When I got the PhD scholarship, he did not hesitate to be my supervisor in spite of having a large number of PhD students, and he has always been there for me in both academic and non-academic affairs. His research experience, expert opinions, and encouragement enabled me to move smoothly through my PhD journey. One of his strengths, which I will always carry with me in my academic life, is his strong belief in “room for improvement” even in the situations where I was convinced myself that there was nothing else to improve. Special thanks also go to my co-supervisor, Professor Judith Molka Danielsen for her advice and guidance in different parts of my thesis. In spite of joining as a supervisor in the middle of this PhD project, her contributions and insights made a notable improvement from the development of the questionnaire to the writing of the final report. I say thank you for your time and support. I would also like to convey my special appreciation to my evaluation committee for agreeing to be part of this project and sparing time from their busy schedule to go through this project and give valuable feedback. I say thank you to associate professor Berit Irine Helgheim from Molde University College; Specialized University in Logistics, Molde, Norway; Professor Sven Arne Haugland from the Norwegian School of Economics, Bergen, Norway and Professor Rodney L. Stump, Towson University, Maryland, USA. My heartfelt appreciation goes to associate professor Richard Glavee-Geo from Ålesund University College for his friendship and professional guidance in my PhD work. He was always available whenever I needed his advice from the choice of PhD courses to the process of writing this PhD project. May almighty God rewards you abundantly for your kindness and efforts to get my PhD done. My sincere acknowledgement goes to Molde University College administrative staff, including international coordinator Ragnihild Brakstard, Vera Høstmark, Berit Svendsvik, Wagbo Sissel, and Bente Lindset for providing all the support within their power to make my PhD life conducive. I also express my appreciation to Jens Erik Østergaard and other staff from the IT centre for their technical support during the course of my PhD. v Sincere thanks go to my PhD colleagues, family and friends at Molde: Pastor Albert and Francine from Sion Molde; Deodat Mwesiumo and his wife Synnøve Solbakken; Nina Pereira, Yusta Simwita, Gladness Salema and Jorge Oyola Mendoza, Jasmine el Melady, Benjamin Sakita, Emmanuel Kafti, Jimmy Mudeyi, Leonard Misigallo, and Diana Eleksandrova. The jokes we shared, their support and social gatherings during my time in Molde made my PhD process a journey to remember. I am deeply indebted to Gladness Foya, Nina Nchimbi and Bahati from SIDO Tanga, Dar es Salaam and Pwani region respectively; Gaudencia Donati from Sokoine University and Morogoro Food clusters, and Gladness Foya from “Let’s improve food project”; Mr Chami, Mama Mushi, Aprifetius food products, Stella Mtutina for their support during the focus group discussion interviews, development of questionnaires, sampling frame, pilot study and main data collection. To my colleagues from the University of Dar es salaam Business School, Dr. Latifa Mbelwa, Dr. Theresia Dominic, Dr. Henry Challu, Dr. Tobias Swai and my friend Masudi Salumu for their supports during the process of questionnaire development, translation and data analysis. Thank you for smoothening my PhD path. To former Deans of the University of Dar es salaam Business School: Prof. Marcelina Chijoriga and Prof. Winnester Anderson, current Dean: Dr. Ulingeta Mbamba, and the head of department of General Management for their administrative support during my PhD process. To my relatives and friends : Edson Kanani, Bertha Kanani, Rebecca Kanani, Suzana Madoshi, Revocatus Kilangwa and his wife, Joram Emmanuel, Emmanuel Jonathan, Cosmas Mhande and Cosmas Masanja for proving support to my family while I was away. Lastly, special and deepest thanks goes to my love, wife and friend Valentina Martine for her love, patience and encouragement. Her support in visiting farmers’ exhibitions in the early stages of this work, and in the printing and organisation of the questionnaire took a huge burden off my shoulders. Even in the time where we were far apart in different continents, she never stopped providing her support. My heart is filled with appreciation and my soul is deeply moved by your love. To my beloved daughters: Jahdiela Bernadette and Davinia; their playful personalities cheered me up and kept me going when things were getting tough. Molde, 2015 Renger Kanani vi Contents Preface ....................................................................................................................... iii Acknowledgement ....................................................................................................... v Contents .................................................................................................................... vii List of Tables ............................................................................................................... x List of Figures ............................................................................................................. xi Abstract .................................................................................................................... xiv CHAPTER 1 INTRODUCTION 1.1 Introduction ........................................................................................................ 1 1.2 Research Problem ............................................................................................. 3 1.3 Objective of the Study ....................................................................................... 4 1.4 Contribution of the Study ................................................................................... 5 1.5 Organization of the study ................................................................................... 7 CHAPTER 2 THEORETICAL FRAMEWORKS 2.1 Introduction ...................................................................................................... 13 2.2 Transaction Cost Theory (TCT) ....................................................................... 14 2.3 Measurement Cost Theory and Technology .................................................... 27 2.4 Relational Contracting Theory ......................................................................... 29 2.5 Exposition of Purchase volume ....................................................................... 33 2.6 Chapter Summary ........................................................................................... 35 CHAPTER 3 CONCEPTUAL MODEL AND HYPOTHESES 3.1. Introduction ..................................................................................................... 37 3.2 Research Model .............................................................................................