Strategy and Irreversibility in Supplier Relations: The Case of the U.S. Automobile Industry

Abstract

The purchasing strategies of the dominant U.S. automakers form a topic neglected by both economists and business historians. The following article examines the automakers' changing relations with their suppliers throughout the twentieth century. Using the exit/voice paradigm, it establishes a framework that can account for both current and past strategies, even when they seem to contradict the logic of economic theory.