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What lies between market and hierarchy? Insights from internalization theory and global value chain theory

Journal of international business studies, 2019-10, Vol.50 (8), p.1401-1413 [Peer Reviewed Journal]

2018 Academy of International Business ;Academy of International Business 2018 ;Copyright Palgrave Macmillan Oct 2019 ;ISSN: 0047-2506 ;EISSN: 1478-6990 ;DOI: 10.1057/s41267-018-0186-0

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  • Title:
    What lies between market and hierarchy? Insights from internalization theory and global value chain theory
  • Author: Strange, Roger ; Humphrey, John
  • Subjects: Business and Management ; Business Strategy/Leadership ; Companies ; Internalization ; International Business ; Management ; Organization ; Power ; RESEARCH NOTE ; Stock offerings ; Value chain
  • Is Part Of: Journal of international business studies, 2019-10, Vol.50 (8), p.1401-1413
  • Description: In this paper, we suggest that internalization theory might be extended by incorporating complementary insights from GVC theory. More specifically, we argue that internalization theory can explain why lead firms might wish to externalize selected activities, but that it is largely silent on the mechanisms by which those lead firms might exercise control over the resultant externalized relationships with their GVC partners. We advance an explanation linking the choice of control mechanism to two factors: power asymmetries between the lead firms and their GVC partners, and the degree of codifiability of the information to be exchanged in the relationship.
  • Publisher: London: Springer Science + Business Media
  • Language: English
  • Identifier: ISSN: 0047-2506
    EISSN: 1478-6990
    DOI: 10.1057/s41267-018-0186-0
  • Source: ProQuest Central
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