Mukherjee, Arijit; Tsai, Yingyi - Leverhulme Centre for Research on Globalisation and …
We show that international outsourcing may reduce welfare of the outsourcing country by deterring market-entry, thus … showing a new effect which is different from the employment and the quality effects creating negative impacts of outsourcing …. Entry deterrence under outsourcing reduces domestic welfare if both the profit extraction and cost saving from outsourcing …