The return of vertical integration. By Daniel Gross - Slate Magazine:
"Responding to the recent rise in prices for crucial commodities like copper, rubber, nickel, and oil, manufacturers of all types have taken steps to ensure they have adequate supplies of raw materials and parts. The article cited several examples of companies that bought outright or took stakes in their suppliers. In July, Armor Holdings, which makes armored cars and other products for what it delicately calls the 'survivability industry,' acquired Integrated Textile Systems Inc., which makes a type of fiber used in earmarks products. To ensure a supply of titanium-based parts for its drumlin 787, Boeing last week created a joint venture with Russia's VSPMO-Avisma, the world's largest titanium producer. In 2005, Bridgestone, the Japanese tire maker, purchased a huge Indonesian rubber plantation from Goodyear. "
How does this affect the idea that there are different types of capitalism that operate in different ways? Rhenish capitalism will focus on long-term, incremental innovation that will likely encourage vertical integration; Anglo-Saxon capitalism will be more flexible and more likely to create adaptive structures that are not vertically integrated.
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