Lockin situations in supply chains: A social exchange theoretic study of sourcing arrangements in buyersupplier relationships Academic Article uri icon

abstract

  • AbstractSocial exchange theory is used to gain a better understanding of the relationship between a buyer and a supplier that is characterized by lockin situations. We begin by reviewing the theoretical foundations of social exchange theory. Next, we use an illustrative multinational business example from a Danish Business Group to demonstrate the complexities of the lockin situation. Conjectures related to lockin behaviors are initially developed and then examined by means of a gametheoretic model. The analysis provides a basis for the development of propositions which are examined employing a behavioral experiment. The results indicate that the optimal pricing strategy of the supplier is to lower the price with increasing demand and the optimal investment intensity of the buyer decreases with increasing demand. The paper concludes by presenting directions for future research.

published proceedings

  • Journal of Operations Management

altmetric score

  • 3

author list (cited authors)

  • Narasimhan, R., Nair, A., Griffith, D. A., Arlbjrn, J. S., & Bendoly, E.

citation count

  • 170

complete list of authors

  • Narasimhan, Ram||Nair, Anand||Griffith, David A||Arlbjørn, Jan Stentoft||Bendoly, Elliot

publication date

  • October 2009

publisher