Effects of adverse selection on a multinational firm's decision on where to subcontract

• Tipo: Artigo em Revista Científica Internacional
• Data: 2008

Autores

Forte, R (Autor) FEP; Brandao, A (Autor) FEP

Revista

Título: Journal of Industry, Competition and Trade

Vol. 8 Nº 2

Páginas: 133-146

ISSN: 1566-1679

Editora: Springer Nature

Indexação

ISI Web of Knowledge

Scopus - 1 Citação

Classificação Científica

CORDIS: Ciências Sociais > Economia

Outras Informações

ID Authenticus: P-007-KZ0

DOI: 10.1007/s10842-007-0014-x

Abstract (EN): This paper analyses the effects of adverse selection on a multinational firm's decision on where to subcontract. Adverse selection arises since subcontractor firms have more information than the multinational concerning their production costs. The results obtained show that adverse selection confers to subcontractor firms an advantage in their relationship with the multinational, inducing the multinational to subcontract in more than one country. In this way, adverse selection modelling outcomes justify, and are coherent with, the empirical evidence such as, the diversity of countries that multinational firms subcontract and the fast production relocation between countries. © Springer Science+Business Media, LLC 2007.

Idioma: Inglês

Tipo (Avaliação Docente): Científica