A (transactional) governance structure is the "institutional framework within which the integrity of a transaction is decided" (Williamson 1979: 240). Such governance structures are only a sub-part of the overall governance of the firm, but in this paper we confine our attention only to those aspects of governance relating to transactions in goods and services.<sup>2</sup> They comprise both tools for problem prevention and tools to provide solutions should problems arise. A governance structure is a coordinated combination of different mechanisms that together encourage the fulfillment of agreements to transact. Such mechanisms might be trust, hit-men, legally enforceable contracts, etc. No existing studies obtain a comprehensive, consistent, crosscountry picture on how these mechanisms are combined within governance structures.<sup>3</sup> One reason for this lacuna is surely that there exists no general theoretical framework that predicts which particular combinations of mechanisms one should expect to observe often, and which can be safely ignored.

The absence of a tight theory to guide the empirics has important consequences for how research must proceed. The pertinent survey question must ask about a comprehensive variety of individual mechanisms. The question must have a very general structure that resonates with the concerns of all types of firms, and makes responding feasible whatever the nature of any firm. Therefore, a first contribution of this paper is the construction of a new survey question, together with a demonstration that it elicits reliable data from representative samples of firms in many countries. The paper establishes the validity of the question and the responses it elicits data through examples of the productive use of the resultant data in practical settings.

Additionally, the absence of a tight theoretical framework means that data cannot be collected on governance structures, per se, but must instead focus on the use of individual mechanisms that are themselves inputs into different governance structures. The challenge then is understanding which individual mechanisms are combined by firms to produce coherent governance structures. Thus, a crucial task in building a comprehensive picture is to find those combinations that exist in practice. That is, one must apply an exploratory statistical technique that isolates archetypes of governance structures, effectively substituting empirics for what usually would be a theoretical exercise. This type of statistical investigation is very common in general, and is usually approached using latent variables. In our case, the governance structures themselves are viewed as the values, or classes, of a categorical latent variable. Exploring the characteristics of the classes thus discovered is a key part of the investigation. In an examination

> <sup>2</sup> Thus, a governance structure in the sense used by Williamson, and in this paper, excludes most of the activities that fall under the umbrella of "corporate governance." We do not consider, for example, transactions with banks or shareholders, but rather focus on transactions with suppliers of production inputs and customers for the firm's goods and services.

> <sup>3</sup> Hendley et al. (2000), Hendley and Murrell (2003), and Mike and Kiss (2019) are the only country-wide studies of which we are aware that use datasets to which the current paper's methods could be applicable.  These datasets are all on single countries. The World Bank's Regional Project on Enterprise Development (RPED) collected cross-country comparable data on, inter alia, firms' attempts to solve transactional problems in 7 African countries beginning in the early 1990's. (On this project and some of its work on transactional issues, see Fafchamps (2004).) Although containing very rich cross-country-comparable data on transactional problems and their solutions, the questions used in the RPED surveys are not in a form that would make the responses suitable for analysis of issues addressed in this paper.  Unlike the current paper, none of the studies cited in this footnote use a sampling design and survey weights so that estimates are representative of a whole economy.

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