Roles of Wholesalers in Transaction Networks

Author Name OKUBO Toshihiro  (Keio University) /ONO Yukako  (Keio University) /SAITO Yukiko  (Senior Fellow, RIETI)
Creation Date/NO. October 2014 14-E-059
Research Project Inter-organizational and Inter-inventors Geographical Proximity and Networks
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Notes Revised: February 2015


Wholesalers are considered to play an important role in ensuring efficient transaction networks. Using unique data on Japanese domestic transactions compiled by Tokyo Shoko Research, we investigate wholesalers' roles in transaction networks for intermediate manufacturing goods. Comparing manufacturing firms transacting directly and those connected indirectly through wholesalers, we find a clear asymmetry in the characteristics of buyer- and seller-side manufacturers that tend to rely on wholesalers. We also examine how transaction distances differ depending on transaction partners, and find that, as compared to manufacturing partners in direct transactions, wholesalers tend to locate closer to their manufacturing buyers and farther from their manufacturing sellers, ceteris paribus. This gives us insights on how wholesalers support transaction networks that connect geographically dispersed manufacturing firms.