ABSTRACT
This chapter examines a loosely specific co-operative agreement that was subsequently plagued by chronic ex post haggling between a parent firm and its subsidiary. The case exposes the limits of constitutional authority and the challenge involved in balancing autonomy and interdependence. The German and British Babcock companies simultaneously used combinations of institutional instruments – in contrast to theoretical literatures that see such devices as distinct alternatives – to transfer knowledge across boundaries. Yet, in the end they failed to establish a co-operative relationship.
