Subcontracting and Vertical Integration in the Spanish Cotton Industry

UPF Working Paper No. 816

37 Pages Posted: 17 Nov 2005

See all articles by Joan R. Rosés

Joan R. Rosés

London School of Economics & Political Science (LSE) - London School of Economics

Date Written: March 2005

Abstract

This paper examines changes in the organization of the Spanish cotton industry from 1720 to 1860 in its core region of Catalonia. As the Spanish cotton industry adopted the most modern technology and experienced the transition to the factory system, cotton spinning and weaving mills became increasingly vertically integrated. Asset specificity more than other factors explained this tendency towards vertical integration. The probability for a firm of being vertically integrated was higher among firms located in districts with high concentration ratios and rose with size and the use of modern machinery. Simultaneously, subcontracting predominated in other phases of production and distribution where transaction costs appears to be less important.

Keywords: Transaction cost economics, European industrialization, factory system, organizational change, technological change, international competitiveness

JEL Classification: N63, L22, O33

Suggested Citation

Rosés, Joan R., Subcontracting and Vertical Integration in the Spanish Cotton Industry (March 2005). UPF Working Paper No. 816. Available at SSRN: https://ssrn.com/abstract=849524 or http://dx.doi.org/10.2139/ssrn.849524

Joan R. Rosés (Contact Author)

London School of Economics & Political Science (LSE) - London School of Economics ( email )

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