Hardback
The Economics of Outsourcing
In this wide-ranging collection, Professor Willcocks and Professor Lacity examine the economic determinants and outcomes of outsourcing and offshoring at both the firm and country levels. They provide a comprehensive overview of the topic, offering an interdisciplinary perspective, which covers the empirical and theoretical research not only of economists but also of researchers from other disciplines, most notably business strategy, information systems and international business.
More Information
Critical Acclaim
Contributors
Contents
More Information
In this wide-ranging collection, Professor Willcocks and Professor Lacity examine the economic determinants and outcomes of outsourcing and offshoring at both the firm and country levels. They provide a comprehensive overview of the topic, offering an interdisciplinary perspective, which covers the empirical and theoretical research not only of economists but also of researchers from other disciplines, most notably business strategy, information systems and international business.
With an authoritative, original introduction by the editors, the book will be an indispensible guide to students and scholars, wishing to understand the theoretical and empirical research on the economics of outsourcing from its beginnings in the 1930s to current thinking.
With an authoritative, original introduction by the editors, the book will be an indispensible guide to students and scholars, wishing to understand the theoretical and empirical research on the economics of outsourcing from its beginnings in the 1930s to current thinking.
Critical Acclaim
‘. . .a weighty yet solid set of critical economic writings that narrow their topic to the major issues involved in outsourcing and offshoring work for countries and business establishments alike. A powerful blend of data and critical analysis that college-level readers will find important.’
– The Midwest Book Review
– The Midwest Book Review
Contributors
35 articles, dating from 1937 to 2013
Contributors include: N.S. Argyres, R.H. Coase, S. Ghoshal, M. Kotabe, J.T. Macher, K.J. Mayer, M. Reitzig, B. Richman, R.M. Salomon, O.E. Williamson, T.R. Zenger
Contributors include: N.S. Argyres, R.H. Coase, S. Ghoshal, M. Kotabe, J.T. Macher, K.J. Mayer, M. Reitzig, B. Richman, R.M. Salomon, O.E. Williamson, T.R. Zenger
Contents
Contents:
Dedication to Ronald Coase
Acknowledgements
Introduction Leslie P. Willcocks and Mary C. Lacity
PART I THE THEORETICAL FOUNDATION, CRITIQUES AND REVIEW OF TRANSACTION COST ECONOMICS
1. R.H. Coase (1937), ‘The Nature of the Firm’, Economica, 4, 386–405
2. Oliver E. Williamson (1991), ‘Comparative Economic Organization: The Analysis of Discrete Structural Alternatives’, Administrative Science Quarterly, 36 (2), June, 269–96
3. Ian R. Macneil (1978), ‘Contracts: Adjustment of Long-term Economic Relations Under Classical, Neoclassical, and Relational Contract Law’, Northwestern University Law Review, 72 (6), 854–905
4. R.H. Coase (1998), ‘The New Institutional Economics’, American Economic Review: Papers and Proceedings, 88 (2), May, 72–4
5. Sumantra Ghoshal and Peter Moran (1996), ‘Bad for Practice: A Critique of the Transaction Cost Theory’, Academy of Management Review, 21 (1), January, 13–47
6. Richard Carter and Geoffrey M. Hodgson (2006), ‘The Impact of Empirical Tests of Transaction Cost Economics on the Debate on the Nature of the Firm’, Strategic Management Journal, 27 (5), May, 461–76
7. Jeffrey T. Macher and Barak D. Richman (2008), ‘Transaction Cost Economics: An Assessment of Empirical Research in the Social Sciences’, Business and Politics, 10 (1), ii, 1–63
8. Mary C. Lacity, Leslie P. Willcocks and Shaji Khan (2011), ‘Beyond Transaction Cost Economics: Towards an Endogenous Theory of Information Technology Outsourcing’, Journal of Strategic Information Systems, 20 (2), June, 139–57
PART II VERTICAL INTEGRATION
9. Kirk Monteverde and David J. Teece (1982), ‘Supplier Switching Costs and Vertical Integration in the Automobile Industry’, Bell Journal of Economics, 13 (1), Spring, 206–213
10. David T. Levy (1985), ’The Transactions Cost Approach to Vertical Integration: An Empirical Examination’, Review of Economics and Statistics, 67 (3), August, 438–45
11. Soon Ang and Detmar W. Straub (1998), ‘Production and Transaction Economies and IS Outsourcing: A Study of the U.S. Banking Industry’, MIS Quarterly, 22 (4), December, 535–52
12. Mark Wahrenburg, Andreas Hackethal, Lars Friedrich and Tom Gellrich (2006), ‘Strategic Decisions Regarding the Vertical Integration of Human Resource Organizations: Evidence for an Integrated HR Model for the Financial Services Industry in Germany, Austria and Switzerland’, International Journal of Human Resource Management, 17 (10), October, 1726–71
13. Matthew Bidwell (2010), ‘Problems Deciding: How the Structure of Make-or-Buy Decisions Leads to Transaction Misalignment’, Organization Science, 21 (2), March–April, 362–79
14. Nicholas S. Argyres and Todd R. Zenger (2012), ‘Capabilities, Transaction Costs, and Firm Boundaries’, Organization Science, 23 (6), November–December, 1643–57
PART III CONTRACTUAL RELATIONSHIPS
15. Laura Poppo and Todd Zenger (2002), ‘Do Formal Contracts and Relational Governance Function as Substitutes or Complements?’, Strategic Management Journal, 23 (8), August, 707–725
16. Paul L. Joskow (1987), ‘Contract Duration and Relationship-Specific Investments: Empirical Evidence from Coal Markets’, American Economic Review, 77 (1), March, 168–85
17. Martin Brown, Armin Falk and Ernst Fehr (2004), ‘Relational Contracts and the Nature of Market Interactions’, Econometrica, 72 (3), May, 747–80
18. Shaila M. Miranda and C. Bruce Kavan (2005), ‘Moments of Governance in IS Outsourcing: Conceptualizing Effects of Contracts on Value Capture and Creation’, Journal of Information Technology, 20 (3), September, 152–69
19. Vivek Choudhury and Rajiv Sabherwal (2003), ‘Portfolios of Control in Outsourced Software Development Projects’, Information Systems Research, 14 (3), September, 291–314
20. Kathleen M. Eisenhardt (1989), ‘Agency Theory: An Assessment and Review’, Academy of Management Review, 14 (1), January, 57–74
21. Kyle J. Mayer and Robert M. Salomon (2006), ‘Capabilities, Contractual Hazards, and Governance: Integrating Resource-based and Transaction Cost Perspectives’, Academy of Management Journal, 49 (5), October, 942–59
PART IV GLOBAL SOURCING DECISIONS
22. Gene M. Grossman, Elhanan Helpman and Adam Szeidl (2005), ‘Complementarities between Outsourcing and Foreign Sourcing’, American Economic Review: Papers and Proceedings, 95 (2), May, 19–24
23. Robert C. Feenstra and Gordon H. Hanson (2005), ‘Ownership and Control in Outsourcing to China: Estimating the Property-Rights Theory of the Firm’, Quarterly Journal of Economics, 120 (2), May, 729–61
24. Pol Antràs (2005), ‘Property Rights and the International Organization of Production’, American Economic Review: Papers and Proceedings, 95 (2), May, 25–32
25. Janet Y. Murray, Masaaki Kotabe and Stanford A. Westjohn (2009), ‘Global Sourcing Strategy and Performance of Knowledge-Intensive Business Services: A Two-Stage Strategic Fit Model’, Journal of International Marketing, 17 (4), 90–105
26. Matthias Holweg, Andreas Reichhart and Eui Hong (2011), ‘On Risk and Cost in Global Sourcing’, International Journal of Production Economics, 131 (1), May, 333–41
PART V INNOVATION AND OUTSOURCING
27. Michael A. Stanko and Roger J. Calantone (2011), ‘Controversy in Innovation Outsourcing Research: Review, Synthesis and Future Directions’, R&D Management, 41 (1), January, 8–20
28. Carmen Weigelt and M.B. Sarkar (2012), ‘Performance Implications of Outsourcing for Technological Innovations: Managing the Efficiency and Adaptability Trade-Off ‘, Strategic Management Journal, 33 (2), February, 189–216
29. Jeremy Howells, Dimitri Gagliardi and Khaleel Malik (2008), ‘The Growth and Management of R&D Outsourcing: Evidence from UK Pharmaceuticals’, R&D Management, 38 (2), March, 205–219
PART VI ECONOMIC AND PERFORMANCE EFFECTS
30. Kholekile L. Gwebu, Jing Wang and Li Wang (2010), ‘Does IT Outsourcing Deliver Economic Value to Firms?’, Journal of Strategic Information Systems, 19 (2), June, 109–123
31. Mary C. Lacity, Stan Solomon, Aihua Yan and Leslie P. Willcocks (2011), ‘Business Process Outsourcing Studies: A Critical Review and Research Directions’, Journal of Information Technology, 26 (4), December, 221–58
32. Markus Reitzig and Stefan Wagner (2010), ‘The Hidden Costs of Outsourcing: Evidence from Patent Data’, Strategic Management Journal, 31 (11), November, 1183–201
33. George N. Kenyon and Mary J. Meixell (2011), ‘Success Factors and Cost Management Strategies for Logistics Outsourcing’, Journal of Management and Marketing Research, 7, April, 1–17
34. Ronald F. Premuroso, Terrance R. Skantz and Somnath Bhattacharya (2012), ‘Disclosure of Outsourcing in the Annual Report: Causes and Market Returns Effects’, International Journal of Accounting Information Systems, 13 (4), December, 382–402
35. Joseph Chen, Harrison Hong, Wenxi Jiang and Jeffrey D. Kubik (2013), ‘Outsourcing Mutual Fund Management: Firm Boundaries, Incentives, and Performance’, Journal of Finance, LXVIII (2), April, 523–58
Index
Dedication to Ronald Coase
Acknowledgements
Introduction Leslie P. Willcocks and Mary C. Lacity
PART I THE THEORETICAL FOUNDATION, CRITIQUES AND REVIEW OF TRANSACTION COST ECONOMICS
1. R.H. Coase (1937), ‘The Nature of the Firm’, Economica, 4, 386–405
2. Oliver E. Williamson (1991), ‘Comparative Economic Organization: The Analysis of Discrete Structural Alternatives’, Administrative Science Quarterly, 36 (2), June, 269–96
3. Ian R. Macneil (1978), ‘Contracts: Adjustment of Long-term Economic Relations Under Classical, Neoclassical, and Relational Contract Law’, Northwestern University Law Review, 72 (6), 854–905
4. R.H. Coase (1998), ‘The New Institutional Economics’, American Economic Review: Papers and Proceedings, 88 (2), May, 72–4
5. Sumantra Ghoshal and Peter Moran (1996), ‘Bad for Practice: A Critique of the Transaction Cost Theory’, Academy of Management Review, 21 (1), January, 13–47
6. Richard Carter and Geoffrey M. Hodgson (2006), ‘The Impact of Empirical Tests of Transaction Cost Economics on the Debate on the Nature of the Firm’, Strategic Management Journal, 27 (5), May, 461–76
7. Jeffrey T. Macher and Barak D. Richman (2008), ‘Transaction Cost Economics: An Assessment of Empirical Research in the Social Sciences’, Business and Politics, 10 (1), ii, 1–63
8. Mary C. Lacity, Leslie P. Willcocks and Shaji Khan (2011), ‘Beyond Transaction Cost Economics: Towards an Endogenous Theory of Information Technology Outsourcing’, Journal of Strategic Information Systems, 20 (2), June, 139–57
PART II VERTICAL INTEGRATION
9. Kirk Monteverde and David J. Teece (1982), ‘Supplier Switching Costs and Vertical Integration in the Automobile Industry’, Bell Journal of Economics, 13 (1), Spring, 206–213
10. David T. Levy (1985), ’The Transactions Cost Approach to Vertical Integration: An Empirical Examination’, Review of Economics and Statistics, 67 (3), August, 438–45
11. Soon Ang and Detmar W. Straub (1998), ‘Production and Transaction Economies and IS Outsourcing: A Study of the U.S. Banking Industry’, MIS Quarterly, 22 (4), December, 535–52
12. Mark Wahrenburg, Andreas Hackethal, Lars Friedrich and Tom Gellrich (2006), ‘Strategic Decisions Regarding the Vertical Integration of Human Resource Organizations: Evidence for an Integrated HR Model for the Financial Services Industry in Germany, Austria and Switzerland’, International Journal of Human Resource Management, 17 (10), October, 1726–71
13. Matthew Bidwell (2010), ‘Problems Deciding: How the Structure of Make-or-Buy Decisions Leads to Transaction Misalignment’, Organization Science, 21 (2), March–April, 362–79
14. Nicholas S. Argyres and Todd R. Zenger (2012), ‘Capabilities, Transaction Costs, and Firm Boundaries’, Organization Science, 23 (6), November–December, 1643–57
PART III CONTRACTUAL RELATIONSHIPS
15. Laura Poppo and Todd Zenger (2002), ‘Do Formal Contracts and Relational Governance Function as Substitutes or Complements?’, Strategic Management Journal, 23 (8), August, 707–725
16. Paul L. Joskow (1987), ‘Contract Duration and Relationship-Specific Investments: Empirical Evidence from Coal Markets’, American Economic Review, 77 (1), March, 168–85
17. Martin Brown, Armin Falk and Ernst Fehr (2004), ‘Relational Contracts and the Nature of Market Interactions’, Econometrica, 72 (3), May, 747–80
18. Shaila M. Miranda and C. Bruce Kavan (2005), ‘Moments of Governance in IS Outsourcing: Conceptualizing Effects of Contracts on Value Capture and Creation’, Journal of Information Technology, 20 (3), September, 152–69
19. Vivek Choudhury and Rajiv Sabherwal (2003), ‘Portfolios of Control in Outsourced Software Development Projects’, Information Systems Research, 14 (3), September, 291–314
20. Kathleen M. Eisenhardt (1989), ‘Agency Theory: An Assessment and Review’, Academy of Management Review, 14 (1), January, 57–74
21. Kyle J. Mayer and Robert M. Salomon (2006), ‘Capabilities, Contractual Hazards, and Governance: Integrating Resource-based and Transaction Cost Perspectives’, Academy of Management Journal, 49 (5), October, 942–59
PART IV GLOBAL SOURCING DECISIONS
22. Gene M. Grossman, Elhanan Helpman and Adam Szeidl (2005), ‘Complementarities between Outsourcing and Foreign Sourcing’, American Economic Review: Papers and Proceedings, 95 (2), May, 19–24
23. Robert C. Feenstra and Gordon H. Hanson (2005), ‘Ownership and Control in Outsourcing to China: Estimating the Property-Rights Theory of the Firm’, Quarterly Journal of Economics, 120 (2), May, 729–61
24. Pol Antràs (2005), ‘Property Rights and the International Organization of Production’, American Economic Review: Papers and Proceedings, 95 (2), May, 25–32
25. Janet Y. Murray, Masaaki Kotabe and Stanford A. Westjohn (2009), ‘Global Sourcing Strategy and Performance of Knowledge-Intensive Business Services: A Two-Stage Strategic Fit Model’, Journal of International Marketing, 17 (4), 90–105
26. Matthias Holweg, Andreas Reichhart and Eui Hong (2011), ‘On Risk and Cost in Global Sourcing’, International Journal of Production Economics, 131 (1), May, 333–41
PART V INNOVATION AND OUTSOURCING
27. Michael A. Stanko and Roger J. Calantone (2011), ‘Controversy in Innovation Outsourcing Research: Review, Synthesis and Future Directions’, R&D Management, 41 (1), January, 8–20
28. Carmen Weigelt and M.B. Sarkar (2012), ‘Performance Implications of Outsourcing for Technological Innovations: Managing the Efficiency and Adaptability Trade-Off ‘, Strategic Management Journal, 33 (2), February, 189–216
29. Jeremy Howells, Dimitri Gagliardi and Khaleel Malik (2008), ‘The Growth and Management of R&D Outsourcing: Evidence from UK Pharmaceuticals’, R&D Management, 38 (2), March, 205–219
PART VI ECONOMIC AND PERFORMANCE EFFECTS
30. Kholekile L. Gwebu, Jing Wang and Li Wang (2010), ‘Does IT Outsourcing Deliver Economic Value to Firms?’, Journal of Strategic Information Systems, 19 (2), June, 109–123
31. Mary C. Lacity, Stan Solomon, Aihua Yan and Leslie P. Willcocks (2011), ‘Business Process Outsourcing Studies: A Critical Review and Research Directions’, Journal of Information Technology, 26 (4), December, 221–58
32. Markus Reitzig and Stefan Wagner (2010), ‘The Hidden Costs of Outsourcing: Evidence from Patent Data’, Strategic Management Journal, 31 (11), November, 1183–201
33. George N. Kenyon and Mary J. Meixell (2011), ‘Success Factors and Cost Management Strategies for Logistics Outsourcing’, Journal of Management and Marketing Research, 7, April, 1–17
34. Ronald F. Premuroso, Terrance R. Skantz and Somnath Bhattacharya (2012), ‘Disclosure of Outsourcing in the Annual Report: Causes and Market Returns Effects’, International Journal of Accounting Information Systems, 13 (4), December, 382–402
35. Joseph Chen, Harrison Hong, Wenxi Jiang and Jeffrey D. Kubik (2013), ‘Outsourcing Mutual Fund Management: Firm Boundaries, Incentives, and Performance’, Journal of Finance, LXVIII (2), April, 523–58
Index
