Contractual Networks, Inter-Firm Cooperation and Economic Growth
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Contractual Networks, Inter-Firm Cooperation and Economic Growth

Edited by Fabrizio Cafaggi

This insightful book presents a legal and economic analysis of inter-firm cooperation through networks as an alternative to vertical integration. It examines comparatively various forms of collaboration, ranging from consortia to multiparty joint ventures and from franchising to dealerships.
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Chapter 8: Interfirm Networks Across Europe: A Private International Law Perspective

Fabrizio Cafaggi and Sandrine Clavel

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8. Interfirm networks across Europe: a private international law perspective Fabrizio Cafaggi and Sandrine Clavel INTRODUCTION 1. European firms are predominantly small and family owned. While many of them are export oriented, their ownership structure is domestic. Competition drives profound transformations of the European industrial system. Inter-firm collaboration constitutes a powerful growth device that can generate more effective supply chains. The formation of transeuropean networks composed of enterprises located in different Member States can promote higher European market integration and contribute to the development of a more competitive European industry. Historically, these forms of collaboration took place even in the pre-capitalistic era and contributed to the creation of an integrated payment system to enhance trade and exchanges. They were the outcome of private orderings developed with the approval of local governments. Today more powerful States require a different and more interventionist approach at the European level. The provision of rules concerning choice of law and general models of inter-firm collaboration can support this process, together with new policies on technological transfer and innovation. Within contractual networks, we distinguish between two models: networks of bilateral linked contracts and multilateral contracts. The former are characterized by bilateral contracts among different parties linked by a common objective. A typical illustration is that of a supply chain where the main contractor concludes contracts with first-tier subcontractors which in turn sign contracts with a second tier. Another illustration is that of a distribution contract where a producer creates a network with many distributors. Within this...

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