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dc.contributor.author Kranton, RE
dc.contributor.author Minehart, DF
dc.date.accessioned 2010-06-28T19:05:14Z
dc.date.issued 2000-09-01
dc.identifier.citation RAND Journal of Economics, 2000, 31 (3), pp. 570 - 601
dc.identifier.issn 0741-6261
dc.identifier.uri http://hdl.handle.net/10161/2628
dc.identifier.uri http://www.jstor.org/stable/2601001
dc.description.abstract We construct a theory to compare vertically integrated firms to networks of manufacturers and suppliers. Vertically integrated firms make their own specialized inputs. In networks, manufacturers procure specialized inputs from suppliers that, in turn, sell to several manufacturers. The analysis shows that networks can yield greater social welfare when manufacturers experience large idiosyncratic demand shocks. Individual firms may also have the incentive to form networks, despite the lack of long-term contracts. The analysis is supported by existing evidence and provides predictions as to the shape of different industries.
dc.format.extent 570 - 601
dc.format.mimetype application/pdf
dc.language.iso en_US
dc.relation.ispartof RAND Journal of Economics
dc.title Networks versus vertical integration
dc.type Journal Article
dc.department Economics
dc.relation.journal RAND Journal of Economics
pubs.issue 3
pubs.organisational-group /Duke
pubs.organisational-group /Duke/Sanford School of Public Policy
pubs.organisational-group /Duke/Sanford School of Public Policy/Duke Population Research Institute
pubs.organisational-group /Duke/Sanford School of Public Policy/Duke Population Research Institute/Duke Population Research Center
pubs.organisational-group /Duke/Trinity College of Arts & Sciences
pubs.organisational-group /Duke/Trinity College of Arts & Sciences/Economics
pubs.publication-status Published
pubs.volume 31

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