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'Outsourcing and Supplier Networks in the German Aircraft Industry during World War II
| During World War II labor productivity in German armament industries grew considerably. Recent studies have shown that this growth was not only - as could be expected given the complexity of armaments' manufacturing - caused by learning effects but also by a process of considerably heightened outsourcing: the inter-firm division of labor in the armament industries increased significantly during these years. However, the motives for and organization of this outsourcing process are little known. And did this outsourcing have long-term effects on the German economy or did it constitute only a short-term phenomenon brought about by the specific wartime circumstances? To address these questions our paper discusses first the several motives and circumstances leading to the outsourcing of intermediate goods, such as components of weapons, to other companies in Germany and in Europe under Nazi rule. In the second part we analyze the supplier network of Germany's most important aircraft program - the construction of the heavy bomber JU 88 - primarily based on annual audit reports of many companies involved in the different production stages of the JU 88. It will be shown that outsourcing was not only limited to manufacturers involved in the final assembly of aircrafts. Companies producing components, too, increased their outsourcing significantly. Finally, we show that many suppliers of the German aircraft industry later became suppliers of West Germany's booming car industry after World War II, a development probably of vital importance to its success story.
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