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Understanding the manufacturing location decision: the case for the transaction cost and capability perspectives

McIvor, Ronan (2012) Understanding the manufacturing location decision: the case for the transaction cost and capability perspectives. The Journal of Supply Chain Management, 49 (2). pp. 23-26. [Journal article]

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DOI: DOI: 10.1111/jscm.12010

Abstract

This paper highlights the value of employing the resource-based view (RBV) and transaction cost economics (TCE) to understand the manufacturing location decision. The RBV can assist with analyzing manufacturing capabilities, which can link the decision with performance and the competitive position of the organization. TCE provides a powerful theoretical lens to augment this analysis. Understanding transaction costs allows an organisation to adopt a relationship strategy, which reduces the risks of outsourcing whilst at the same time leverage the specialist capabilities of suppliers. Moreover, further research is required to enhance our understanding of how the variables from the RBV and TCE interact in sourcing decisions. In particular, it is argued that employing these theories in the manufacturing location decision would contribute to the academic debate on the complementary and contradictory prescriptions of TCE and the RBV in outsourcing decision-making contexts.

Item Type:Journal article
Keywords:Manufacturing location decision; nearshore; offshore; resource-based view; transaction cost economics.
Faculties and Schools:Ulster Business School > Department of International Business
Ulster Business School
Research Institutes and Groups:Business and Management Research Institute
ID Code:35778
Deposited By: Professor Ronan McIvor
Deposited On:06 Sep 2016 08:54
Last Modified:17 Oct 2017 16:25

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