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Modular Production Networks in Electronics: The Nexus between Management and Economics Research

  • Byron Gangnes


    (Department of Economics, University of Hawaii at Manoa)

  • Ari Van Assche

    (Department of Economics, University of California at Santa Cruz)

In the last two decades, the electronics industry has evolved from a vertically integrated in-dustry to a vertically segmented one. This transformation has often been attributed to the modularization of electronic products. In this paper, we argue that the degree of modularity is an active choice variable for a firm. As a result, it is necessary to focus on the underlying fac-tors that drive both modularity and the organization of production. This provides insights into the transformation taking place in global electronics production, with vertical fragmentation, horizontal consolidation, and the growth of Asian electronics production.

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Paper provided by University of Hawaii at Manoa, Department of Economics in its series Working Papers with number 200405.

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Length: 24 pages
Date of creation: Aug 2004
Date of revision:
Handle: RePEc:hai:wpaper:200405
Note: Also Singapore Management University Economics and Statistics Working Paper 21-2004, September 2004
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  1. Ashish Arora & Andrea Fosfuri & Alfonso Gambardella, 2004. "Markets for Technology: The Economics of Innovation and Corporate Strategy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262511819, June.
  2. Hart, Oliver D. & Moore, John, 1990. "Property Rights and the Nature of the Firm," Scholarly Articles 3448675, Harvard University Department of Economics.
  3. Joseph E. Stiglitz & Shahid Yusuf, 2001. "Rethinking the East Asian Miracle," World Bank Publications, The World Bank, number 13969.
  4. Pol Antràs & Elhanan Helpman, 2003. "Global Sourcing," NBER Working Papers 10082, National Bureau of Economic Research, Inc.
  5. Shahid Yusuf, 2003. "Innovative East Asia : The Future of Growth," World Bank Publications, The World Bank, number 15158.
  6. Richard N. Langlois, 2002. "Modularity in Technology and Organization," Chapters, in: Entrepreneurship and the Firm, chapter 2 Edward Elgar.
  7. Ulrich, Karl, 1995. "The role of product architecture in the manufacturing firm," Research Policy, Elsevier, vol. 24(3), pages 419-440, May.
  8. Lowe, Nichola & Kenney, Martin, 1999. "Foreign Investment and the Global Geography of Production: Why the Mexican Consumer Electronics Industry Failed," World Development, Elsevier, vol. 27(8), pages 1427-1443, August.
  9. John McLaren, 2000. ""Globalization" and Vertical Structure," American Economic Review, American Economic Association, vol. 90(5), pages 1239-1254, December.
  10. Gene M. Grossman & Elhanan Helpman, 2002. "Integration versus Outsourcing in Industry Equilibrium," The Quarterly Journal of Economics, Oxford University Press, vol. 117(1), pages 85-120.
  11. Boy Luthje, 2002. "Electronics Contract Manufacturing: Global Production and the International Division of Labor in the Age of the Internet," Industry and Innovation, Taylor & Francis Journals, vol. 9(3), pages 227-247.
  12. Dieter Ernst, 2003. "How Sustainable are Benefits from Global Production Networks? Malaysia's Upgrading Prospects in the Electronics Industry," Economics Study Area Working Papers 57, East-West Center, Economics Study Area.
  13. Carliss Y. Baldwin & Kim B. Clark, 2000. "Design Rules, Volume 1: The Power of Modularity," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262024667, June.
  14. repec:hrv:faseco:4784029 is not listed on IDEAS
  15. Timothy J. Sturgeon, 2002. "Modular production networks: a new American model of industrial organization," Industrial and Corporate Change, Oxford University Press, vol. 11(3), pages 451-496, June.
  16. Dieter Ernst, 2002. "Global Production Networks in East Asia's Electronics Industry and Upgrading Perspectives in Malaysia," Economics Study Area Working Papers wp44, East-West Center, Economics Study Area, revised Oct 2003.
  17. David L. Hummels & Dana Rapoport & Kei-Mu Yi, 1998. "Vertical specialization and the changing nature of world trade," Economic Policy Review, Federal Reserve Bank of New York, issue Jun, pages 79-99.
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