Transaction costs and human relationships

I first came across transaction cost economics (TCE) in my MBA class at RSM. It was intriguing as TCE was used to explain the reason for a firm to exist at all, mergers, contracts, employment and so on. The idea is that every transaction has a cost because of negotiations, paperwork, delays, egos, self interest, etc. The idea of any business "equilibrium" is to reduce this cost. A new equilibrium should be achieved when the benefits of the status quo is possible at lower transaction cost. It got me thinking about human relationships too. Why do people get married or get into long term relationships? The most obvious answer is love and affection. But there are quite a few among us, who have felt love and affection for quite a few other humans, but we don't get into a long term relationship with all of them. My theory is this: Two new factors are also responsible - risk aversion and TCE! Now, every one takes risks. In some areas of life, one takes more risks than others. A lot of us are very happy to take risks in our profession, but we don't quite like risk in our private life. It tends to give us a sense of continuity and perhaps even rest and an outlet for our stress. Most of us also at one point or the other in our lives decide that we 'need' this continuity and low risk in our personal life. As one gains a sense of security, continuity and a low risk feel in his or her personal life, it gets tougher to make a change in that personal life - the "transaction cost" of the change becomes higher. The sooner someone gets risk averse and evaluates the transaction cost, the sooner that person gets into a long term relationship. What does this have to do with BUSINESS.. Deepen and broaden your personal relationship with your customer. That way you increase his or her transaction cost of switching to another supplier. Network with the customer on several areas of his/her life. Take them out to dinner, or go out with them. Get them to like you and trust you. It's good for your personal life and good for business!