Vertical coordination has grown strongly in global supply chains. Local suppliers in developing countries engage in complex contracting with companies selling into high-income markets - either domestically or internationally. These contracts not only specify conditions for delivery and production processes, but also include the provision of inputs, technology, management advice etc. This paper analyzes how weak contract enforcement institutions and imperfect factor markets are affecting vertical coordination in development, and what the implications are for income creation and rent distribution.
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Paper provided by LICOS - Centre for Institutions and Economic Performance, K.U.Leuven in its series LICOS Discussion Papers with number
18407.
Find related papers by JEL classification: C78 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Bargaining Theory; Matching Theory D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
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