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It can generate a rise in incomes if reduced transaction costs promote trade.
But technology has reduced transaction costs, making sharing assets cheaper and easier than ever and therefore possible on a much larger scale.
Once normal commerce resumed, importers enjoyed reduced transaction costs and foreign investors did not need to worry about exchange-rate volatility.
It reduced transaction costs, of course, but it also kept major economies from using their exchange rate as a weapon of mercantilism.
The UK's National Audit Office NAOO) said of the PPAs in its 2006 report that they "offer the prospect of a more strategic approach to long-term development challenges, better coordination and reduced transaction costs – where they can be based on well-specified and monitorable strategic objectives".
They are yielding increased consumer power, greater personal data ownership and reduced transaction costs, over the long term.
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Such arrangements are partly intended to reduce transaction costs.
Advocates argue high-frequency trading HFT improves markets, provides liquidity and reduces transaction costs.
"If the key point is to reduce transaction costs, then iX is flawed".
Retailers and brands can make long-term purchase contracts with traders to reduce transaction costs.
Trading companies that gain access to long-term markets will reap savings by reducing transaction costs.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com