Environmental Relationships of the Internal Political Economy of Marketing Channels

TLDR

The political economy framework illuminates the interplay between internal and external sociopolitical and economic forces shaping marketing channels. The study develops a theoretical model, using retailer informant data, to explain how heterogeneity and output variability drive channel structures—complex, fluid arrangements to cope with uncertainty and vertical integration or bureaucratization to reduce dependence. Data were collected and analyzed from retailer informants on channel environments, configuration, and decision structure to build the model. Both hypotheses were supported, showing that heterogeneity leads to complex, fluid channel structures while high output variability promotes vertical integration and bureaucratization.

Abstract

The political economy framework illuminates interplay between the internal and external sociopolitical and economic forces of marketing channels. Framing the collection and analysis of data from retailer informants on channel environments, configuration, and decision structure, a theoretical model is developed for explaining interorganizational responses to uncertainty and dependence constraints of the channel environment. Heterogeneity is hypothesized to precipitate complex and fluid channel structures as a means of coping with uncertainty. In contrast, high levels of variability in the output environment are expected to foster vertical integration and bureaucratization as a means of reducing dependence. Support for both hypotheses is reported and implications for future research are discussed.