Grossman, Gene M.; Helpman, Elhanan - In: Review of Economic Studies 72 (2005) 1, pp. 135-159
We study the determinants of the location of subcontracted activity in a general equilibrium model of outsourcing and … trade. We model outsourcing as an activity that requires search for a partner and relationship-specific investments that are … governed by incomplete contracts. The extent of international outsourcing depends "inter alia" on the thickness of the domestic …