Vertical integration and outsourcing: hierarchies and markets essay
Explain the distinction between markets and hierarchies and their relationship to transaction costs. Take a company and analyse the extent to which it does operations in-house and the extent to which it uses outsourcing. How does this choice of strategy relate to transaction costs? What other considerations than transaction costs determine this strategy?
Chosen company = apple
Details on how to answer –
You need to find out what Apple does as a vertically integrated company and what it outsources and think about how that relates to transaction costs. Having explained the relationship between markets and hierarchies and transaction costs, as the first part of the question asks.