Convergences and divergences between the concepts of transaction and agency costs

The objective of this essay is to evaluate the convergences and divergences between the concepts of transaction and agency costs, which are used in different theories, approaches and contexts, a fact that ultimately hinders consistency in their respective theoretical and interpretative uses. The theoretical dimensions of costs are evaluated, such as unit of analysis, behavioral assumptions of individuals, and generating facts. Three conclusions are reached. First, it is verified that the terms transaction and agency costs can be adopted in a broad or narrow sense. Second, by adopting the strict concepts, it is possible to distinguish between transaction and agency costs. Finally, adopting the broad concepts, it is possible to establish the agency cost as a kind of transactional cost.