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Tapered integration is a term from organization theory that refers to a mix of vertical integration and market exchange.[1] Upstream, a producer might manufacture some of the input itself and buy the remaining portion from independent firms. Downstream, the manufacturer might sell a portion of its output through an in-house sales force and use independent sales forces to sell the remainder.
It is not documented when the term tapered integration was first used, though it can be found in law journals such as the Yale Law Journal as early as the 1950s,[2] the first known use in academia being a case study by William King Norris.[3]
^Besanko, D., Dranove, D., Shanley, M., Schaefer, S. (2013). Economics of Strategy. 6th edition, Hoboken, NJ: Wiley, p. 148.
^Kessler, F., Stern, R. H. (1959). Competition, Contract, and Vertical Integration. The Yale Law Journal, 69(1), p. 12.
^Norris, W. K. (1954). A Case Study in Forward Tapered Integration. University of Pennsylvania.
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