Span of control, transaction costs, and the structure of production chains

Tomoo Kikuchi, Kazuo Nishimura, John Stachurski

This paper builds coordination costs, transaction costs, and other aspects of the theory of the firm into a production chain model with an infinite number of ex ante identical producers. The equilibrium determines prices, allocations of productive tasks across firms, firm sizes, and the number of active firms. These prices and allocations match several stylized facts on firm boundaries, vertical integration, and division of the value chain.

MoreLess

Year of publication:	May 2018
Authors:	Kikuchi, Tomoo ; Nishimura, Kazuo ; Stachurski, John
Published in:	Theoretical economics : TE ; an open access journal in economic theory. - Toronto : [Verlag nicht ermittelbar], ISSN 1555-7561, ZDB-ID 2220447-7. - Vol. 13.2018, 2, p. 729-760
Subject:	Span of control \| firm boundaries \| fragmentation \| production chains \| Transaktionskosten \| Transaction costs \| Lieferantenmanagement \| Supplier relationship management \| Lieferkette \| Supply chain \| Theorie der Unternehmung \| Theory of the firm