Vertical Networks and Us Auto Parts Exports: Is Japan Different?

39 Pages Posted: 15 Sep 2002 Last revised: 28 Oct 2010

See all articles by Keith Head

Keith Head

University of British Columbia (UBC) - Sauder School of Business

John C. Ries

University of British Columbia (UBC) - Sauder School of Business; University of British Columbia (UBC) - SFU-UBC Centre for the Study of Government and Business

Barbara J. Spencer

University of British Columbia (UBC) - Sauder School of Business; National Bureau of Economic Research (NBER)

Date Written: September 2002

Abstract

This paper develops a model in which upstream network insiders' conduct relationship specific investment that induces the downstream firm to transact within networks. The scale of destination-country production and part-specific measures of the importance of network relationships and engineering costs are used to explain the pattern of U.S. auto parts exports. Our results support the prediction that large scale promotes relationship-specific investment and reduces imports. Also, while Japan is a large parts importer, the composition of its imports is shifted away from parts where vertical keiretsu are prominent. Nations hosting U.S.-owned automakers import more U.S. parts.

Suggested Citation

Head, Keith Charles and Ries, John C. and Spencer, Barbara J., Vertical Networks and Us Auto Parts Exports: Is Japan Different? (September 2002). NBER Working Paper No. w9162. Available at SSRN: https://ssrn.com/abstract=331005

Keith Charles Head

University of British Columbia (UBC) - Sauder School of Business ( email )

2053 Main Mall
Vancouver, BC V6T 1Z2
Canada
604-822-8492 (Phone)
604-822-8477 (Fax)

John C. Ries

University of British Columbia (UBC) - Sauder School of Business ( email )

2053 Main Mall
Vancouver, BC V6T 1Z2
Canada

University of British Columbia (UBC) - SFU-UBC Centre for the Study of Government and Business ( email )

2053 Main Mall
Vancouver, British Columbia V6T 1Z2
Canada
604-822-8493 (Phone)
604-822-8477 (Fax)

Barbara J. Spencer (Contact Author)

University of British Columbia (UBC) - Sauder School of Business ( email )

2053 Main Mall
Vancouver, BC V6T 1Z2
Canada
604-822-8479 (Phone)
604-822-8477 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
31
Abstract Views
2,002
PlumX Metrics