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Vertical Coordination: A Transactions Cost Approach

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  • Frank, Stuart D.
  • Henderson, Dennis R.

Abstract

Vertical coordination has been shown to be superior to vertical integration as an element of industrial structure. In this paper, the effects of transaction costs on vertical coordination are investigated. The results confirm the theoretical expectation that transaction costs are the primary motivation for vertical coordination.

Suggested Citation

  • Frank, Stuart D. & Henderson, Dennis R., 1990. "Vertical Coordination: A Transactions Cost Approach," 1990 Annual meeting, August 5-8, Vancouver, Canada 270876, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    • Handle: RePEc:ags:aaea90:270876
    DOI: 10.22004/ag.econ.270876
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    References listed on IDEAS

    as
    1. Levy, David T, 1985. "The Transactions Cost Approach to Vertical Integration: An Empirical Examination," The Review of Economics and Statistics, MIT Press, vol. 67(3), pages 438-445, August.
    2. M. A. Adelman, 1955. "Concept and Statistical Measurement of Vertical Integration," NBER Chapters, in: Business Concentration and Price Policy, pages 281-330, National Bureau of Economic Research, Inc.
    3. Laffer, Arthur B, 1969. "Vertical Integration by Corporations, 1929-1965," The Review of Economics and Statistics, MIT Press, vol. 51(1), pages 91-93, February.
    4. George J. Stigler, 1951. "The Division of Labor is Limited by the Extent of the Market," Journal of Political Economy, University of Chicago Press, vol. 59, pages 185-185.
    5. MacDonald, James M, 1985. "Market Exchange or Vertical Integration: An Empirical Analysis," The Review of Economics and Statistics, MIT Press, vol. 67(2), pages 327-331, May.
    6. Ravenscraft, David J, 1983. "Structure-Profit Relationships at the Line of Business and Industry Level," The Review of Economics and Statistics, MIT Press, vol. 65(1), pages 22-31, February.
    7. Maddigan, Ruth J, 1981. "The Measurement of Vertical Integration," The Review of Economics and Statistics, MIT Press, vol. 63(3), pages 328-335, August.
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