The last decade has witnessed substantial changes in organizational structure, inter-organizational relations and the nature of competition. In particular, the realization of interdependencies across firm boundaries has brought forth a range of mechanisms for coordination among firms in vertically related stages of production, or among direct competitors in the same industry. Our objective is to study inter-organizational relations in an oligopolistic setting to explore the interactions between efficiency and strategic incentives for organizations to engage in various forms of coordination, vertically or horizontally. Specifically, we employ a game-theoretic approach to analyze organizational structure and coordination incentives in relation to process innovation, transfer pricing, and degree of competition between products. This study is divided into four parts. / In the first part, we look at the impact of manufacturer's investments in process innovation to reduce production costs on distribution channel structure, and vice versa. We show that the optimal channel structure decision depends on interactions between two parameters: degree of product differentiation and the extent of production cost reduction. These parameters represent the two primary 'generic strategies' that most organizations follow in order to gain competitive advantage. Second, we show that decentralized manufacturers invest less in process innovation than integrated manufacturers do. However, manufacturers may prefer decentralized, non-coordinated channels to perfectly coordinated channels when product substitutability is high, contrary to efficiency and transaction-cost based arguments for increased coordination. / In the second part, we relax the assumption that a manufacturer has a choice only between integration (or 'hierarchy') and decentralization (or 'market'). Various means of channel coordination are analyzed, and ownership is assumed to be distinct from the particular coordination mechanism employed. It is shown that the consideration of the competitive environment changes incentives for, and benefits to, coordination in various Production, Inventory, and Pricing decisions among members of a supply chain. / In the third part, we focus on horizontal cooperation among firms, ignoring the vertical relations. We consider the possibility of technological spillovers in the process innovation efforts of the manufacturers, and their incentives to engage in cooperative R&D agreements with rivals in the same industry. We develop a two-stage game model with manufacturers producing differentiated products, and establish fairly general conditions under which different cooperative arrangements would be beneficial both for manufacturers and consumers. / In the fourth part, we merge the above two dimensions, i.e., we investigate the interactions between horizontal cooperative agreements among rival manufacturers and vertical coordination arrangements along the supply chain. The models above are extended to incorporate the triple influence of technological spillovers and research joint ventures, along with demand and cost side parameters, on supply chain coordination incentives. We argue that a better understanding of such interactions is crucial in explicating a more relevant theory of the firm.
| Identifer | oai:union.ndltd.org:LACETR/oai:collectionscanada.gc.ca:QMM.34969 |
| Date | January 1998 |
| Creators | Gupta, Sudheer. |
| Contributors | Loulou, Richard (advisor) |
| Publisher | McGill University |
| Source Sets | Library and Archives Canada ETDs Repository / Centre d'archives des thèses électroniques de Bibliothèque et Archives Canada |
| Language | English |
| Detected Language | English |
| Type | Electronic Thesis or Dissertation |
| Format | application/pdf |
| Coverage | Doctor of Philosophy (Faculty of Management.) |
| Rights | All items in eScholarship@McGill are protected by copyright with all rights reserved unless otherwise indicated. |
| Relation | alephsysno: 001641383, proquestno: NQ44446, Theses scanned by UMI/ProQuest. |
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