Frequency indicates the degree of recurrence a transaction is performed (Williamson 1985), which according to Azevedo (2000) has a twofold role. First, when it is very frequent, the average fixed costs reduce, which are related to infor­mation collection and the preparation of a complex contract that sets restrictions to opportunism. Second, the higher the frequency, the less reasons for agents to impose losses on their partners, since an opportunistic attitude could lead to a disruption of the transaction and result in future earning losses from the transac­tion. In other words, for recurring transactions, the parties can create a reputation, which limits their interest in opportunistic attitudes for short-term gains, since according to the agents’ interpretation, gains tend to be higher in the long term (Azevedo 2000).

Repeating a transaction results in the parties getting to know each other through a reliable agreement stipulated around common interests. Even negotiations in the spot market have a cost reduction with recurring transactions due to a higher repu­tation (Farina et al. 1997). By establishing a reputation, trust on that agent also increases, which can lead to reducing safeguard clauses, hence reducing contrac­tual and monitoring costs (Bonfim 2011).

The governance structure regulated by the market itself is recommended for occasional or recurrent non-specific transactions, but in both cases, they are subject to standardization. Thus, the market can coordinate the relationships between the agents in a particular chain. The second one is characterized by a multilateral governance structure intended for occasional transactions, but it is characterized by mixed or highly specific investments. Therefore, this structure will inevitably be coordinated by contracts, that is, companies will try to elabo­rate individual or collective contracts for each type of transaction and for each type of agent. The third case is the one with a vertical governance structure, related to different types of recurring transactions and characterized by their high investment specificity, in other words, requiring more specific investments. Thus, this structure is characterized by incorporating a specific activity by the contracting party or even by all activities associated with the final product. This incorporation can be identified by a full or partial verticalization (Garcia and Romeiro 2009).

3.1 Uncertainty

The second key attribute discussed by Williamson (1996) is uncertainty. The impor­tance of considering this attribute results from the safeguards not addressed in the contracts. In an environment of uncertainty, agents are unable to predict all the events. Thus, the lower this prediction, the greater the gaps in the contracts and therefore the higher the chances of losses arising from the agents’ opportunistic behavior: In agri­culture, uncertainty may stem from various forms, such as natural disasters or unan­ticipated interventions in the food markets. Given this situation, contract renegotiation conflicts are plausible, which adds costs to the system as a whole (Azevedo 2000).