Rossini, Gianpaolo
(2005)
Pitfalls in private and social incentives of vertical crossborder outsourcing.
Bologna:
Dipartimento di Scienze economiche DSE,
p. 33.
DOI
10.6092/unibo/amsacta/4754.
In: Quaderni - Working Paper DSE
(536).
ISSN 2282-6483.
Full text available as:
Abstract
Vertical production processes take increasingly place in a crossborder
fashion with two distinct patterns. Either a multinational firm
(MNF) controls the whole vertical chain spreading production over
many countries or vertically separeted firms, belonging to different
countries, operate independently in distinct stages. Which arrangement
emerges is a matter of incentives. On the private side, the decrease
of transport costs may expand crossborder outsourcing, due to the incentives to disintegrate that emerge alternatively for the Upstream
and the Downstream sections of production. Even though
there remains a social superiority of vertical integration (V I) this becomes
questionable since the benefits are spread over more than one
country, and some country may rather like a vertically disintegrated
(VD) arrangement, which is often more trade oriented. Finally, we
consider an international duopoly with a vertical restraint, coming
either from a competition or a trade policy. Additional private incentives
to go VD; due to some fresh drawbacks of V I; arise and countries
may show distinct patterns of V I according to their relative size.
Abstract
Vertical production processes take increasingly place in a crossborder
fashion with two distinct patterns. Either a multinational firm
(MNF) controls the whole vertical chain spreading production over
many countries or vertically separeted firms, belonging to different
countries, operate independently in distinct stages. Which arrangement
emerges is a matter of incentives. On the private side, the decrease
of transport costs may expand crossborder outsourcing, due to the incentives to disintegrate that emerge alternatively for the Upstream
and the Downstream sections of production. Even though
there remains a social superiority of vertical integration (V I) this becomes
questionable since the benefits are spread over more than one
country, and some country may rather like a vertically disintegrated
(VD) arrangement, which is often more trade oriented. Finally, we
consider an international duopoly with a vertical restraint, coming
either from a competition or a trade policy. Additional private incentives
to go VD; due to some fresh drawbacks of V I; arise and countries
may show distinct patterns of V I according to their relative size.
Document type
Monograph
(Working Paper)
Creators
Keywords
Vertical Integration, Outsourcing, Trade, R&D, Di¤erentiation
Subjects
ISSN
2282-6483
DOI
Deposit date
18 Mar 2016 10:14
Last modified
18 Mar 2016 10:14
URI
Other metadata
Document type
Monograph
(Working Paper)
Creators
Keywords
Vertical Integration, Outsourcing, Trade, R&D, Di¤erentiation
Subjects
ISSN
2282-6483
DOI
Deposit date
18 Mar 2016 10:14
Last modified
18 Mar 2016 10:14
URI
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