English, Article, Journal or magazine article edition: Organizing Offshoring: Middle Managers and Communication Costs Pol Antras; Pol Antràs; Luis Garicano; ...

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Bookmark: http://trove.nla.gov.au/version/30035
Physical Description
  • preprint
Language
  • English

Edition details

Title
  • Organizing Offshoring: Middle Managers and Communication Costs
Author
  • Pol Antras
  • Pol Antràs
  • Luis Garicano
  • Esteban Rossi-Hansberg
Physical Description
  • preprint
Notes
  • Why do firms decide to offshore certain parts of their production process? What qualifies certain countries as particularly attractive locations to offshore? In this paper we address these questions with a theory of international production hierarchies in which teams arise endogenously to make efficient use of agents' knowledge. Our theory highlights the role of host-country management skills (middle management) in bringing about the emergence of international offshoring. By shielding top management in the source country from routine problems faced by host country workers, the presence of middle managers improves the efficiency of the transmission of knowledge across countries. The model further delivers the prediction that the positive effect of middle skills on offshoring is weaker, the more advanced are communication technologies in the host country. We provide evidence consistent with this prediction
  • Offshoring, Organizations, FDI
  • RePEc:red:sed006:133
  • Why do firms decide to offshore certain parts of their production process? What qualifies certain countries as particularly attractive locations to offshore? In this paper we address these questions with a theory of international production hierarchies in which organizations arise endogenously to make efficient use of agents' knowledge. Our theory highlights the role of host-country management skills (middle management) in bringing about the emergence of international offshoring. By shielding top management in the source country from routine problems faced by host country workers, the presence of middle managers improves the efficiency of the transmission of knowledge across countries. The model further delivers the prediction that the positive effect of middle skills on offshoring is weaker, the more advanced are communication technologies in the host country. We provide evidence consistent with this prediction.
  • RePEc:nbr:nberwo:12196
Language
  • English
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