Drivers for vertical integration in the rail sector – using wagons as “relationship specific assets”
The International Journal of Logistics Management
ISSN: 0957-4093
Article publication date: 8 August 2016
Abstract
Purpose
The purpose of this paper is to analyse vertical integration in the rail sector using a combination of transaction cost economics (TCE), the resource-based view (RBV) and the relational view, through which rail wagons are viewed as “relationship specific assets”.
Design/methodology/approach
The empirical analysis is based on a cross-case comparison of four case studies of intermodal operators in Europe, each exhibiting different levels of collaboration and integration between terminals, operators and sub-contractors.
Findings
Viewing rail wagons as relationship specific assets rather than merely transaction specific (TCE) or firm specific (RBV) demonstrates that wagon ownership is not only a good indicator of the level of vertical cooperation but of the existence of trust and learning within a collaborative environment.
Practical implications
The organisational setup is not derived purely from transaction or resource characteristics, but by the integration of processes through the purchase of assets that will be used to produce a service, with the expected levels of trust and commitment. In this sense, the role of the wagon as a relationship specific asset is a microcosm of the key elements of a successful intermodal transport system.
Originality/value
As one of the key operational aspects of the rail sector is the use of expensive equipment and the relative responsibility for fixed and moveable assets, an analysis of the use of rail wagons as relationship specific assets allows a more dynamic understanding of vertical integration in the rail sector than currently provided by TCE or RBV alone.
Keywords
Acknowledgements
The authors would like to thank the company representatives who shared their time and knowledge with us throughout the course of this research. The research for this paper was undertaken with the financial support of the GreCOR project funded by the European Union through the ERDF Interreg IVB programme, The Swedish Transport Administration and The Sustainable Transport Initiative financed by the Swedish Government.
Citation
Monios, J. and Bergqvist, R. (2016), "Drivers for vertical integration in the rail sector – using wagons as “relationship specific assets”", The International Journal of Logistics Management, Vol. 27 No. 2, pp. 533-551. https://doi.org/10.1108/IJLM-01-2015-0021
Publisher
:Emerald Group Publishing Limited
Copyright © 2016, Emerald Group Publishing Limited