Make Versus Buy in Trucking: Asset Ownership, Job Design, and Information

Posted: 7 Feb 2003  

Thomas N. Hubbard

Northwestern University - Department of Management & Strategy; National Bureau of Economic Research (NBER)

George P. Baker

HBS Negotiations, Organizations and Markets Unit; National Bureau of Economic Research (NBER)

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Abstract

Explaining patterns of asset ownership in the economy is a central goal of both organizational economics and industrial organization. We develop a model of asset ownership in trucking, which we test by examining how the adoption of different classes of on-board computers (OBCs) between 1987 and 1997 influenced whether shippers use their own trucks for hauls or contract with for-hire carriers. We find that OBCs' incentive-improving features pushed hauls toward private carriage, but their resource-allocation-improving features pushed them toward for-hire carriage. We conclude that ownership patterns in trucking reflect the importance of both incomplete and of job design and measurement issues.

JEL Classification: D23, L14, L22, L23, L92

Suggested Citation

Hubbard, Thomas N. and Baker, George P., Make Versus Buy in Trucking: Asset Ownership, Job Design, and Information. American Economic Review, Forthcoming. Available at SSRN: https://ssrn.com/abstract=377341

Thomas N. Hubbard (Contact Author)

Northwestern University - Department of Management & Strategy ( email )

Kellogg School of Management
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Evanston, IL 60208
United States

National Bureau of Economic Research (NBER)

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George P. Baker

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

HBS Negotiations, Organizations and Markets Unit ( email )

Soldiers Field
Boston, MA 02163
United States
617-495-6119 (Phone)
617-496-4191 (Fax)

HOME PAGE: http://www.people.hbs.edu/gbaker/index.html

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