COE-RES Discussion Paper Series Center of Excellence Project The Normative Evaluation and Social Choice of Contemporary Economic Systems Graduate School of Economics and Institute of Economic Research Hitotsubashi University COE/RES Discussion Paper Series, No.69 July 26, 2004 From Exit to Voice: the Evolution of the Supplier Relationship in the German and the Japanese Automobile Industries Hiroyuki Okamuro (Graduate School of Economics, Hitotsubashi University) Naka 2-1, Kunitachi, Tokyo 186-8603, Japan Phone: +81-42-580-8350 Fax: +81-42-580-8351 URL: http://wakame.econ.hit-u.ac.jp/~koho/1intro/COE/index.htm E-mail:
[email protected] From Exit to Voice: the Evolution of the Supplier Relationship in the German and the Japanese Automobile Industries Hiroyuki Okamuro Graduate School of Economics, Hitotsubashi University E-mail:
[email protected] Abstract: The purpose of this paper is to investigate the development of the supplier relationship in the German automotive industry from the 1920s to the 1960s and to examine the continuity between the prewar and the postwar periods from a comparative perspective with the Japanese experience. Using original documents mainly from the DaimlerChrysler Archive and focusing on Daimler-Benz, I found that the postwar relationship in Germany is quite different from that in the prewar period. While the arm’s-length relationship was dominant in the prewar period, the postwar relationship is more stable and characterized by intensive mutual commitment. An important turning point in the evolution of the supplier relationship can be found in the wartime economy. However, more direct reasons for the postwar changes lie in the new economic environment and experiences in the postwar period.