This paper seeks to show that even though a product market competitor holds the least cost input production technology, it may outsource its input production to an independent input producer and buy inputs from the firm at a higher price instead of producing inputs in-house for itself....

We construct a model to show that outsourcing of a crucial input can occur even though it can be produced in-house at a lower cost. There are two firms producing differentiated goods and competing in prices, and only one of them possesses input production technology which is superior to that of...

Purpose The purpose of this paper is to show that outsourcing can occur as outcome of a separating or pooling perfect Bayesian equilibrium although it is not profitable under complete information. Therefore, asymmetric information can itself be a reason for outsourcing....

Technology transfer costs have a profound influence on the firm’s entry mode into a production sharing relationship. To explore this nexus, we associate technological complexity of the off-shored input with the organizational mode of international production sharing by extending the Antràs...