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The Management of Subcontracted Networks as an Alternative to Internalisation: The Shift from the Standardised to the Specialised in Frozen and Chilled Foods

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Abstract

This paper is to highlight the management of subcontracted networks as an alternative to internalisation. The contrasting examples of the frozen food sector and the chilled ready meals sector are employed to examine the different economic relationships. The paper draws upon transaction costs economics, interdisciplinary literature from organisation studies, network theory, and sociology to contextualise the functioning of network relationships. The paper examines the shift in the role of the firm from producer, to the firm as co-ordinator of information flows. In contrast to the vertically integrated frozen food sector, the chilled food industry manifests plural organisational forms, with close-knit trust based inter-organisational networks and arms-length subcontracting.

Suggested Citation

  • H. Cox, 1999. "The Management of Subcontracted Networks as an Alternative to Internalisation: The Shift from the Standardised to the Specialised in Frozen and Chilled Foods," CIBS Research Papers in International Business 16-99, London South Bank University CIBS.
  • Handle: RePEc:sbu:cibswp:16-99
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    References listed on IDEAS

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    1. Daniel Sullivan, 1994. "Measuring the Degree of Internationalization of a Firm," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 25(2), pages 325-342, June.
    2. James R. Markusen, 1995. "The Boundaries of Multinational Enterprises and the Theory of International Trade," Journal of Economic Perspectives, American Economic Association, vol. 9(2), pages 169-189, Spring.
    3. Vernon, Raymond, 1979. "The Product Cycle Hypothesis in a New International Environment," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 41(4), pages 255-267, November.
    4. Helpman, Elhanan, 1984. "A Simple Theory of International Trade with Multinational Corporations," Journal of Political Economy, University of Chicago Press, vol. 92(3), pages 451-471, June.
    5. Paul R. Krugman, 1985. "Increasing Returns and the Theory of International Trade," NBER Working Papers 1752, National Bureau of Economic Research, Inc.
    6. Charles Oman, 1996. "The Policy Challenges of Globalisation and Regionalisation," OECD Development Centre Policy Briefs 11, OECD Publishing.
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    Keywords

    subcontracted networks as an alternative to internalisation;

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