EconPapers    
Economics at your fingertips  
 

Complementarities in Automobile Production

Johannes Van Biesebroeck ()

No 12131, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The number of different car and light truck models produced in North America has increased enormously over the last decades. The data suggests that producing this increased variety of vehicles is associated with a productivity penalty. We show that manufacturers can adopt complementary activities to reduce this penalty. Flexible technology, defined as the ability to assemble models derived from different %u201Cplatforms%u201D on the same assembly line, and bringing previously outsourced activities in-house are two such activities that we identify. Both are costly themselves, in terms of lower productivity, but they reduce the cost of producing greater variety. The results are robust to controlling for the endogeneity of the adoption decisions using activity-specific instruments, as proposed by Athey and Stern (2003).

JEL-codes: L23 L11 L62 M11 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ino
Date: 2006-04
Note: PR
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3) Track citations by RSS feed

Published as Johannes Van Biesebroeck, 2007. "Complementarities in automobile production," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(7), pages 1315-1345.

Downloads: (external link)
http://www.nber.org/papers/w12131.pdf (application/pdf)

Related works:
Journal Article: Complementarities in automobile production (2007) Downloads
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: https://EconPapers.repec.org/RePEc:nbr:nberwo:12131

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w12131

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().

 
Page updated 2019-12-10
Handle: RePEc:nbr:nberwo:12131