THE ROLE OF COLLABORATIVE INTEGRATION IN INDUSTRIAL-ORGANIZATION - OBSERVATIONS FROM THE CANADIAN AEROSPACE INDUSTRY

I outline the nature of collaborative relationships and suggest that they increase the level of ''quasi-integration'' in industry. They also increase the spatial diversification of production as firms open new windows on research, technology, and market opportunities through collaboration. Large globally oriented corporations are likely to benefit most from collaboration because they have the human and financial resources to establish ties with research institutions and firms in dispersed networks of productive activity. I summarize collaborative activity in the global aerospace industry and examine the implications of collaborative integration for the Canadian aerospace industry. While collaboration offers new competitive opportunities for aerospace firms in Canada, it also threatens the viability of the domestic industry.