Integration vs. Outsourcing in Industry Equilibrium

Gene Grossman () and Elhanan Helpman

Working Papers from Tel Aviv

Abstract: We develop an equilibrium model of industrial structure in which the organization of firms is endogenous. Differentiated consumer products can be produced either by vertically integrated firms or by pairs of specialized companies. Production of each variety of consumer good requires a unique, specialized component. Vertically integrated firms can manufacture the components they need in the quantity and type that maximizes profits, but they face a relatively high cost of governance.

Keywords: ECONOMIC MODELS; INDUSTRIAL STRUCTURE; COMPETITION (search for similar items in EconPapers)
JEL-codes: D23 D43 D51 (search for similar items in EconPapers)
Date: 2001
View citations in EconPapers

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Working Paper: Integration vs. Outsourcing in Industry Equilibrium (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:fth:teavfo:2001-7

Access Statistics for this paper

More papers in Working Papers from Tel Aviv
Address: Israel TEL-AVIV UNIVERSITY, THE FOERDER INSTITUTE FOR ECONOMIC RESEARCH, RAMAT AVIV 69 978 TEL AVIV ISRAEL.
Contact information at EDIRC.
Series data maintained by Thomas Krichel ().