Firm-asymmetry and strategic outsourcing

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalpeer-review

2 Scopus Citations
View graph of relations

Author(s)

  • Jiyun Cao
  • Arijit Mukherjee
  • Uday Bhanu Sinha

Detail(s)

Original languageEnglish
Pages (from-to)16-24
Journal / PublicationInternational Review of Economics and Finance
Volume53
Online published16 Oct 2017
Publication statusPublished - Jan 2018
Externally publishedYes

Abstract

In contrast to the conventional wisdom, we show that a final goods producer may outsource input production to an outside supplier even if the final goods producer possesses a superior input-production technology compared to the outside supplier. Such an outsourcing may reduce consumer surplus and social welfare. We also show that, in the presence of outsourcing, innovation by the firm doing outsourcing to reduce the cost of in-house input production and to reduce the input coefficient in the final goods production may have significantly different implications for the consumers and the society.

Research Area(s)

  • Consumer surplus, Outsourcing, Welfare

Citation Format(s)

Firm-asymmetry and strategic outsourcing. / Cao, Jiyun; Mukherjee, Arijit; Sinha, Uday Bhanu.

In: International Review of Economics and Finance, Vol. 53, 01.2018, p. 16-24.

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalpeer-review