المجلة الدولية للاداء الاقتصادي
Volume 4, Numéro 3, Pages 71-88
In this paper, we put into perspective international outsourcing and subcontracting, as alternative strategies of firm internationalization. We also identify the trade-offs that allow the firm to choose between integration or outsourcing. Our main results show that if asset ownership is separable without the risk of losing its competitive advantage, the firm should opt for outsourcing through international subcontracting, provided that the transaction costs are lower than the control costs of a foreign subsidiary.
Foreign direct investment ; Outsourcing ; Subcontracting ; Production fragmentation
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