Analysis of Competition in the Defense Industrial Base: An F‐22 Case Study

Consolidation of the defense industrial base has led to concerns about whether enough competition exists between remaining firms to maintain needed cost reduction and innovation. We examine competition in the U.S. defense industrial base by performing an in‐depth case study of Lockheed Martin and the F‐22 program that considers multiple tiers of the industrial base. We find that defense firm specialization has led to outsourcing practices and arguably a more robust U.S. defense industrial base. Implications for government policy are identified . ( JEL H57, O38, D43, L14)