We collect and assess prior empirical evidence on contract design in alliances
that has been published since Parkhe’s (1993) seminal study on inter-firm
contracts. We elaborate on the effects of transaction-related factors,
experience gained from prior relationships, and deliberate learning efforts on
contracts. Our paper offers three contributions. First, we systematically
review the existing literature on alliance contracts and summarize our
findings. Second, while prior research has traditionally focused on
contractual complexity,we place the content of contracts center stage and
identify three contractual functions. While existing studies on contractual
functions predominantly refer to safeguarding as a response to appropriation
concerns, we also consider coordination and contingency adaptability as
outcomes of adaptation concerns. Third, we disentangle the differential
influences of previous experiences on distinct contractual functions and show
that experience gained from prior relationships has different effects on
safeguarding and contingency adaptability than on coordination. Overall, we
add to the systematization of the current debate on alliance contract design
and trace promising avenues for future research on the impact of transaction-
and experience-related factors on the complexity and content of alliance
contracts