Innovation and wage effects of international outsourcing

Amy Jocelyn Glassa and Kamal Saggi

Chapter 2 in Technology Transfer, Foreign Direct Investment, and the Protection of Intellectual Property in the Global Economy, 2023, pp 33-52 from World Scientific Publishing Co. Pte. Ltd.

Abstract: We investigate the effects of increased outsourcing of production to a low wage country. Such international outsourcing lowers the marginal cost of production and thus increases profits, creating greater incentives for innovation. A reduction in the resource requirement in adapting technology relative to improving products or an expansion in the portion of production that can be outsourced generates a greater extent of international outsourcing, a lower relative wage and a faster rate of innovation. An increase in production taxes in the North, production subsidies in the South, or a subsidy to adapting technologies has similar effects.

Keywords: International Technology Transfer; Multinational Firms; Trips; Foreign Direct Investment; Oligopolistic Competition; Vertical Contracts; Intellectual Property Rights (search for similar items in EconPapers)
JEL-codes: F21 (search for similar items in EconPapers)
Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.worldscientific.com/doi/pdf/10.1142/9789813233027_0002 (application/pdf)
https://www.worldscientific.com/doi/abs/10.1142/9789813233027_0002 (text/html)
Ebook Access is available upon purchase.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:wsi:wschap:9789813233027_0002

Ordering information: This item can be ordered from

Access Statistics for this chapter

More chapters in World Scientific Book Chapters from World Scientific Publishing Co. Pte. Ltd.
Bibliographic data for series maintained by Tai Tone Lim ().