Case Study: Petrobras

1228 Words 5 Pages
1 introduction
The mineral oil company Petrobras was founded by the former Brazilian president Getúlio Vargas in 1953, accompanied by his very own exclamation “The petroleum is ours” (Dias and Quaglino 1993: 64). This phrase has since remained present by giving distinction to the firm’s history and is therefore equally applicable to the firm’s exploiting activities on the Bolivian market, where the parastatal company started operating in 1996 (Goldstein 2007: 114). After the conclusion of contract between the Brazilian and the Bolivian government in 1996, Petrobras set up its first subsidiary in the foreign market: Petrobras Bolivia S.A. (Antunes, 2007). By, inter alia, acquiring large refineries from the Bolivian state petroleum company YPFB
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Prospective local operations would only be enabled through the formation of a Joint Venture with YPFB, guaranteeing at least 51% of the share deriving from privatized petroleum activities to the Bolivian company. Moreover, royalties and taxes on gas and oil were raised up to 82 % and firms that would not have adapted to these requirements within 180 days were forced to close their local activities immediately. (Morales …show more content…
Further, they measure the expenses evolving from the actual transaction and can occur from processes such as bargaining, research or communication. Therefore, they differ from the actual production costs and arise “when a good or a service is transferred across a technologically separable interface” (Williamson 1981). In order to determine their emergence and amount, Williamson (1985: 7) identified the importance to distinguish between costs occurring ex-ante (before) and ex-post (after) the conclusion of a contract. Additionally, he analyzed the individual’s behavior and identified two characteristics: limited rationality and opportunism. In the researcher’s findings, the fundamentality to examine a transaction’s nature and define an asset’s specificity (Williamson 1991: 282) is highlighted as well as the frequency of the particular transaction, the uncertainty and risk present in the atmosphere and the environment in which a transaction takes place (Williamson

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