CURRENT ISSUES AFFECTING TRADE AND TRADE POLICY: AN ANNOTATED LITERATURE REVIEW

This review provides a base of literature describing current issues and research on the impacts of lobalization and the industrialization of agriculture and recent approaches to analyze and model agricultural trade and trade policies. Three key factors of the survey are differentiated goods, global economic integration and international supply chain linkages. The review covers 182 publications, which are presented alphabetically by author with a brief annotation describing how it relates to the above criteria. The articles are also indexed by keyword. A brief summary highlights the documented literature and includes a series of issues for future discussion and research.International Relations/Trade,

Network industries in the new economy

In this paper we discuss two propositions: the supply and demand of knowledge, and network externalities. We outline the characteristics that distinguish knowledge- intensive industries from the general run of manufacturing and service businesses. Knowledge intensity and knowledge specialisation has developed as markets and globalisation have grown, leading to progressive incentives to outsource and for industries to deconstruct. The outcome has been more intensive competition. The paper looks at what is potentially the most powerful economic mechanism: positive feedback, alternatively known as demand-side increasing returns, network effects, or network externalities. We present alternative demand curves that incorporate positive feedback and discuss their potential economic and strategic consequences. We argue that knowledge supply and demand, and the dynamics of network externalities create new situations for our traditional industrial economy such that new types of economies of scale are emerging and "winner takes all" strategies are having more influence. This is the first of a pair of papers. A second paper will take the argument further and look at the nature of firms' strategies in the new world, arguing that technology standards, technical platforms, consumer networks, and supply chain strategies are making a significant contribution to relevant strategies within the new economy

Supply chain network capacity competition with outsourcing: a variational equilibrium framework

This paper develops a supply chain network game theory framework with multiple manufacturers/producers, with multiple manufacturing plants, who own distribution centers and distribute their products, which are distinguished by brands, to demand markets, while maximizing profits and competing noncooperatively. The manufacturers also may avail themselves of external distribution centers for storing their products and freight service provision. The manufacturers have capacities associated with their supply chain network links and the external distribution centers also have capacitated storage and distribution capacities for their links, which are shared among the manufacturers and competed for. We utilize a special case of the Generalized Nash Equilibrium problem, known as a variational equilibrium, in order to formulate and solve the problem. A case study on apple farmers in Massachusetts is provided with various scenarios, including a supply chain disruption, to illustrate the modeling and methodological framework as well as the potential benefits of outsourcing in this sector

The Economics of Electronics Industry: Competitive Dynamics and Industrial Organization

This entry highlights fundamental changes in the electronics industry that have transformed its competitive dynamics and industrial organization: a high and growing knowledge intensity; the rapid pace of change in technologies and markets; and extensive globalization. That explosive mixture of forces has created two inter-related puzzles. The first puzzle is that a high degree of globalization may well go hand in hand with high and increasing concentration. This runs counter to the dominant view, based on the assumption of neo-classical trade theory, that globalization will increase competition and hence will act as a powerful equalizer both among nations and among firms. Multinational corporations, after all, may not be such effective "spoilers of concentration", as claimed by Richard Caves (1982). The second related puzzle is that this industry fails to act like a stable global oligopoly, even when concentration is extremely high: a market positions are highly volatile, new entry is possible, and not even market leaders can count on a guaranteed survival.

Structuring postponement strategies in the supply chain by analytical modeling

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VERTICAL INTEGRATION FOR FULL OUTSOURCING: GROWTH AND INTERNATIONALIZATION OF A PORTUGUESE PACKAGING FIRM

Based on a case study of a Portuguese packaging firm, this paper examines how vertical integration of the supplier serves as a vehicle for the full outsourcing of the client firms' needs in a solution that reduces transaction costs, favors specialization, and permits small and mediumsized firms to develop competencies that may be exploited in a wide array of projects. Vertical integration by the supplier (a governance decision) is a strategic response to changes in the sourcing model of the clients. Client-supplier relationships have inter-spatial and inter-temporal value that surpasses spot market exchanges.strategic outsourcing, vertical integration, internationalization, case study

From the Theory of the Firm to FDI and Internalisation: A Survey

This paper surveys recent contributions on the Internalisation issue, based on different theories of the firm, to show how the make-or-buy decision, at an international level, has been assessed through the opening up of the “black box” - traditionally explored by the theorists of the firm – and the simultaneous endogenization of the market environment – as in the International Economics tradition. In particular, we consider three Archetypes – Grossman-Hart-Moore treatment of hold-up and contractual incompleteness, Holmstrom-Milgrom view of the firm as an incentive system, Aghion-Tirole conceptualisation of formal and real authority in organisations – and show how they have been embedded in industry and general equilibrium models of FDI to explain the boundaries of global firms.FDI, Internalisation, International Economics, Incomplete contracts

Quality Competition in Supply Chain Networks with Applications to Information Asymmetry, Product Differentiation, Outsourcing, and Supplier Selection

The quality of the products produced and delivered in supply chain networks is essential for consumers\u27 safety, well-being, and benefits, and for firms\u27 profitability and reputation. However, because of the complexity of today\u27s large-scale highly globalized supply chain networks, along with issues such as the growth in outsourcing and in global procurement, as well as the information asymmetry associated with quality, supply chain networks are more exposed to both domestic and international quality failures. In this dissertation, I contribute to the equilibrium and dynamic modeling and analysis of quality competition in supply chain networks under scenarios of information asymmetry, product differentiation, outsourcing, and under supplier selection. The first part of the dissertation consists of a review of the relevant literature, the research motivation, and an overview of methodologies. The second part of the dissertation formulates quality competition with minimum quality standards under the scenario of information asymmetry, specifically, when there is no product differentiation by brands or labels. In the third part, in contrast, quality competition is modeled under product differentiation, when firms engage in distinguishing their products from their competitors\u27. The fourth part concentrates on quality competition in supply chain networks with outsourcing. The models yield the optimal make-or-buy and contractor selection decisions for the firm(s) and the optimal pricing and quality decisions for the contractors. The impacts of firms\u27 attitudes towards disrepute are also studied numerically. In the fifth part, a multitiered supply chain network model of quality competition with suppliers is developed. It consists of competing suppliers and competing firms who purchase components for the assembly of their products and, if capacity permits, produce their own components. The optimal supplier-selection decisions, optimal component production and quality, and the optimal quality preservation levels of the assembly processes are provided. Such issues as the values of the suppliers to the firms, the impacts of capacity disruptions, and the potential investments in capacity enhancements are explored numerically. The models and analysis in this dissertation can be applied to numerous industries, ranging from the food industry to the pharmaceutical industry, automobile industry, and to the high technology industry