Notes_6_Jan_31-2 - THE VERTICAL COORDINATION CONTINUUM...

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AEB 3300 1 Characteristics of “Invisible- Hand” Coordination Self Interest No Relationship Opportunism Price-based Information Sharing Flexibility Long-term Relationship Open Information Sharing Interdependence Characteristics of “Managed” Coordination THE VERTICAL COORDINATION CONTINUUM Strategic Options for Vertical Coordination NOTE: The diagonal line represents the mix of invisible-hand and managed coordination characteristics found in each of the five alternative strategies for vertical coordination. The area above the diagonal indicates the relative level of invisible-hand characteristics and the area below the diagonal indicates the relative level of managed characteristics Source: Peterson and Wysocki. 1999 Journal Article Spot Market Contracting Relation-based Alliance Equity-based Alliance Vertical Integration
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AEB 3300 2 Examples along Continuum Spot markets Land auction, local cattle auction, estate sale Contracting Forward contracts between growers and processors,
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This note was uploaded on 02/10/2011 for the course AEB 3300 taught by Professor Richardweldon, during the Spring '11 term at University of Florida.

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Notes_6_Jan_31-2 - THE VERTICAL COORDINATION CONTINUUM...

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