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1、Grossman-Hart (1986) Goes Global: IncompleteContracts, Property Rights, and the InternationalOrganization of ProductionPol Antr as Harvard UniversityMay 16, 2012AbstractI survey the influence of Grossman and Harts (1986) seminal paper in the field of Interna- tional Trade. I discuss the implementati
2、on of the theory in open-economy environments and its implications for the international organization of production and the structure of internationaltrade flows. I also review empirical work suggestive of the empirical relevance of the property- rights theory. Along the way, I develop novel theoret
3、ical results and also outline some of the key limitations of existing contributions.This survey was prepared for the “Grossman and Hart at 25” conference held in Brussels on June 24-26, 2011. Iam grateful to Lucia Antras, Davin Chor, Arnaud Costinot, Oliver Hart, and an anonymous referee for very he
4、lpful comments and to Elhanan Helpman for many conversations on this topic over the years. I am also grateful to DavinChor, Federico D ez, Nathan Nunn, Heiwai Tang, and Dan Trefler for kindly sharing their data with me, and to Ruiqing Cao for excellent research assistance.1IntroductionIn 1986, the y
5、ear of publication of Sandy Grossman and Oliver Harts seminal paper on the bound-aries of the firm, the state of the art mobile phone, the Motorola DynaTAC 8000x, resembled a large brick, weighed close to two pounds, and was sold at $3,995 a piece (or a whopping $8,235 incurrent U.S. dollars). That
6、same year, IBM released its first laptop computer, the 13-pound IBM PC Convertible, featuring an Intel 80C88 CPU that ran at 4.77MHz, 256 kBytes of RAM, and a narrow 10-inch LCD screen, all for just $2,000 (or the equivalent of $3,820 today).The last twenty five years have witnessed an information a
7、nd communication technology (ICT) revolution that has transformed the world economy. The exponential growth in the processing powerand memory capacity of computers (as exemplified by Moores law) and the equally exponentialgrowth in the network capacity of optical fiber have led to a dramatic fall in
8、 the cost of processing and transmitting information at long distances. One of the manifestations of this ICT revolution has been the gradual disintegration of production processes (or slicing of the value chain) acrossborders. More and more firms now organize production on a global scale and choose
9、 to offshore parts, components or services to producers in foreign and often distant countries.Although this trend is significant enough to be salient in aggregate statistics, it is often best illustrated through particular examples.1Apples iPad 2 tablet is a case in point. Its slim and sleek exteri
10、or hides a complex manufacturing process combining components provided by multiplier suppliers located in various countries. Apple does not disclose information on its input providers,but teardown reports (such as those published by and ) have shed light on the global nature of the iPad 2 productio
11、n process. The tablet itself is assembled in China (and by the end of 2011 also in Brazil) by Taiwan-based Foxconn. The displays are believed to be manufactured by LG Display and, more recently, by Samsung, both of which are based in South Korea. The distinctive touch panel is produced by Wintek, a
12、Taiwan-based company that also owns plants in China, India and Vietnam, while the case is provided by another Taiwanese company, Catcher Technologies, with operations in Taiwan and China. A third important component, the battery pack, also originates in Taiwan and is sold by Simplo Technologies and
13、Dynapack International.Apart from these easily identifiable parts, the iPad 2 incorporates a variety of chips and other smalltechnical components provided by various firms with R they simply remain incomplete.”The detrimental effects of imperfect contract enforcement on international trade flows are
14、 par- ticularly acute in transactions involving intermediate inputs, as those tend to be associated with longer time lags between the time the order is placed (and the contract is signed) and the timethe goods or services are delivered (and the contract executed), and they also often entail signifi-
15、cant relationship-specific investments and other sources of lock-in on the part of both buyers and suppliers. For instance, suppliers often tailor their manufacturing production to the needs of par-2As an example, Djankov et al. (2003) document that the total duration of a legal procedure aimed at c
16、ollectinga bounced check ranges from 7 days in Tunisia to 1003 in Slovenia.2ticular buyers and have difficulty placing those goods in world markets should the buyer decide notto abide by the terms of the contract. Similarly, buyers undertake significant investments whose value can be severely diminished by incompatibilities, production line delays or quality debasements associated with suppliers not following through with their contractual obligations.In Poorly
