, Volume 20, Issue 2, pp 119-134

A general framework for explaining internal vs. external exchange

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There is an often overlooked substitute for exchange in the marketplace. Organizational units in the form of house-holds and businesses can create, consume and/or use goods and services internally and thus avoid markets. This article offers a unified discussion of why organizations engage in internal as well as external exchange activity, with the objective of encouraging marketing theorists to integrate internal exchange into the discipline. By addressing internal exchange activity, scholars should be able to construct more comprehensive theories of macromarketing, competitive strategy, and perhaps even a general theory of marketing.