Subcontracting dynamics and economic development: A study on textile and engineering industries
AbstractRecent studies on small and medium sized establishments emphasize the importance of networking and regional clusters for industrial development. This study is focused on an important form of cooperation between firms: subcontracting relationship. Our aim is to estimate the determinants of subcontracting in Turkish textile and engineering industries, and to derive policy implications of our estimates. We estimate subcontract offering and subcontract receiving models for both industries by using panel data on all establishments employing 25 or more workers in the period 1988-97. Our findings show that short-term/unequal relationship exists between parent firms and subcontractors in the textile industry whereas subcontracting relationships in the engineering industry are established between "similar", relatively advanced firms that have complementary assets and technologies.
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Bibliographic InfoPaper provided by ERC - Economic Research Center, Middle East Technical University in its series ERC Working Papers with number 0108.
Length: 26 pages
Date of creation: Aug 2001
Date of revision: Aug 2001
Subcontracting; firm cooperation; vertical integration;
Find related papers by JEL classification:
- L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
- L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
- L61 - Industrial Organization - - Industry Studies: Manufacturing - - - Metals and Metal Products; Cement; Glass; Ceramics
- L67 - Industrial Organization - - Industry Studies: Manufacturing - - - Other Consumer Nondurables
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