Manufacturing and Distribution Strategies, Distribution Channels, and Transaction Costs: The Case of Parallel Imported Automobiles

Godfrey Yeung, Wai Kwong Mok

Research output: Journal article publicationJournal articleAcademic researchpeer-review

9 Citations (Scopus)

Abstract

We examine how constraints on transnational corporations' official distribution channels, asset specificity, and bounded rationality of franchise dealers and parallel traders contribute to the sustainability of the parallel importation of automobiles. The manufacturing and distribution strategies employed by transnational corporations considerably add to the regional differences in the pricing and availability of specific models, as well as vehicle specifications. These necessary conditions enable opportunistic parallel traders to engage in arbitrage. The asset specificity of franchise dealers, bounded rationality, and opportunism of dealers and arbitrageurs sustain the parallel importation of automobiles.
Original languageEnglish
Pages (from-to)44-58
Number of pages15
JournalManagerial and Decision Economics
Volume34
Issue number1
DOIs
Publication statusPublished - 1 Jan 2013

ASJC Scopus subject areas

  • Business and International Management
  • Strategy and Management
  • Management Science and Operations Research
  • Management of Technology and Innovation

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