Make versus buy in trucking: Asset ownership, job design, and information

George P. Baker*, Thomas N. Hubbard

*Corresponding author for this work

Research output: Contribution to journalReview articlepeer-review

148 Scopus citations

Abstract

Explaining patterns of asset ownership 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 far-hire carriers. We find that OBCs' incentive-improving features pushed hauls toward private carriage, but their resource-allocation-improving features pushed them toward far-hire carriage. We conclude that ownership patterns in trucking reflect the importance of both incomplete contracts and of job design and measurement issues.

Original languageEnglish (US)
Pages (from-to)551-572
Number of pages22
JournalAmerican Economic Review
Volume93
Issue number3
DOIs
StatePublished - Jun 2003

ASJC Scopus subject areas

  • Economics and Econometrics

Fingerprint Dive into the research topics of 'Make versus buy in trucking: Asset ownership, job design, and information'. Together they form a unique fingerprint.

Cite this