https://macropaperwarehouse.com/authors/felipe-brugues/Felipe BruguésHugo -- gohugo.ioen-ushttps://macropaperwarehouse.com/papers/take-the-goods-and-run-contracting-frictions-and-market-power-in-supply-chains/https://macropaperwarehouse.com/papers/take-the-goods-and-run-contracting-frictions-and-market-power-in-supply-chains/<p>This paper studies the efficiency of self-enforced relational agreements in manufacturing supply chains when sellers have market power and contracts cannot be externally enforced. The setting is Ecuador, an upper-middle-income country with slow commercial courts (debt enforcement takes around two years even after a 2016 reform) and highly concentrated manufacturing markets (average Herfindahl-Hirschman Index of 0.6 for 6-digit economic codes, well above the 0.25 threshold used by the US Department of Justice to identify highly concentrated markets).</p>