Innovation, Networks, and Vertical Integration
A central debate in industrial policy today is that between proponents of large vertically integrated firms on the one hand and advocates of networks of small specialized producers on the other. This paper argues that neither institutional structure is the universal panacea its enthusiasts claim. The menu of institutional alternatives is in fact quite large, and both firms and networks -- of which there is more than one kind -- can be successful, growth- promoting adaptations to the competitive environment. Industrial structures vary in their ability to coordinate information flows necessary for innovation and to overcome power relationships adverse to innovation. The relative desirability of the various structures, then, will depend on the nature and scope of technological change in the industry and on the effects of various product life-cycle patterns. The principal policy conclusion of this analysis is that the government's role ought to be facilitating rather than narrow and
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Paul L. Robertson & Richard N. Langlois, 1994. "Institutions, Inertia, and Changing Industrial Leadership," Industrial Organization 9406005, EconWPA.
- Imai, Ken-ichi & Itami, Hiroyuki, 1984. "Interpenetration of organization and market : Japan's firm and market in comparison with the U.S," International Journal of Industrial Organization, Elsevier, vol. 2(4), pages 285-310, December.
- Cheung, Steven N S, 1983. "The Contractual Nature of the Firm," Journal of Law and Economics, University of Chicago Press, vol. 26(1), pages 1-21, April.
- Helper, Susan & Levine, David I, 1992. "Long-Term Supplier Relations and Product-Market Structure," Journal of Law, Economics and Organization, Oxford University Press, vol. 8(3), pages 561-581, October.
- Langlois, Richard N., 1992. "External Economies and Economic Progress: The Case of the Microcomputer Industry," Business History Review, Cambridge University Press, vol. 66(01), pages 1-50, March.
- Langlois, Richard N. & Robertson, Paul L., 1989. "Explaining Vertical Integration: Lessons from the American Automobile Industry," The Journal of Economic History, Cambridge University Press, vol. 49(02), pages 361-375, June.
- Brusco, Sebastiano, 1982. "The Emilian Model: Productive Decentralisation and Social Integration," Cambridge Journal of Economics, Oxford University Press, vol. 6(2), pages 167-184, June.
- Teece, David J., 1986.
"Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy,"
Elsevier, vol. 15(6), pages 285-305, December.
- Teece, David J., 1993. "Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy," Research Policy, Elsevier, vol. 22(2), pages 112-113, April.
- Helper, Susan, 1991. "Strategy and Irreversibility in Supplier Relations: The Case of the U.S. Automobile Industry," Business History Review, Cambridge University Press, vol. 65(04), pages 781-824, December.
- Florida, Richard L. & Kenney, Martin, 1988. "Venture capital-financed innovation and technological change in the USA," Research Policy, Elsevier, vol. 17(3), pages 119-137, June.
- Dorfman, Nancy S., 1983. "Route 128: The development of a regional high technology economy," Research Policy, Elsevier, vol. 12(6), pages 299-316, December.
- Saxenian, AnnaLee, 1991. "The origins and dynamics of production networks in Silicon Valley," Research Policy, Elsevier, vol. 20(5), pages 423-437, October.
- Langlois, Richard N. & Robertson, Paul L., 1992. "Networks and innovation in a modular system: Lessons from the microcomputer and stereo component industries," Research Policy, Elsevier, vol. 21(4), pages 297-313, August.
When requesting a correction, please mention this item's handle: RePEc:wpa:wuwpio:9406006. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (EconWPA)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.