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Supply chain integration as a form of vertical interaction in the theory of the firm
https://doi.org/10.32609/0042-8736-2022-3-147-160
Abstract
The form of organization and performance of both the entire supply chain and the markets at its individual links are determined by the structure and mechanisms of vertical interaction of its participants. Most existing approaches to explaining such forms emphasize the differences between hierarchy, market and hybrid contracting. This study specifies the forms of vertical interaction in supply chains and determines the factors of their choice. Supply chain integration on a par with vertical restrictive agreements is proposed to be considered as a form of hybrid contracting. On the basis of the theory of the firm the question of the choice of the form of vertical interaction is considered. It is shown that supply chain integration leads to a fundamental transformation of market multilateral relations into bilateral supply contracts and to the formation of transactional-specific assets which ensure the sustainability of this form of vertical interaction. As a result, compared to market interactions, there is a decrease in transaction costs while control costs increase, so supply chain integration occupies an intermediate place between the market and vertical restrictive agreements.
Keywords
supply chain integration,
vertical interaction,
theory of the firm,
transaction costs,
control costs,
trust
JEL: D81, L2, L14
Supporting agencies: This study was supported by the Ministry of Science and Higher Education of the Russian Federation. Agreement No. 075-15-2020-804 dated 02.10.2020 (grant No. 13.1902.21.0016).
About the Authors
S. P. Petrov
Institute of Economics and Industrial Engineering, Siberian Branch of the Russian Academy of Sciences; Novosibirsk State University
Russian Federation
Russian Federation
Sergey P. Petrov
Novosibirsk
V. M. Gilmundinov
Institute of Economics and Industrial Engineering, Siberian Branch of the Russian Academy of Sciences; Novosibirsk State University
Russian Federation
Russian Federation
Vadim M. Gilmundinov
Novosibirsk
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For citations:
Petrov S.P., Gilmundinov V.M. Supply chain integration as a form of vertical interaction in the theory of the firm. Voprosy Ekonomiki. 2022;(3):147-160. (In Russ.) https://doi.org/10.32609/0042-8736-2022-3-147-160
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