Determinants of offshore outsourcing capacity: analysis from information and communication technology

• Grant number: 13/21851-9
• Support Opportunities: Scholarships in Brazil - Scientific Initiation
• Start date: December 01, 2013
• End date: November 30, 2014
• Field of knowledge: Applied Social Sciences - Economics - Social Welfare Economics
• Principal Investigator: Flávia Mori Sarti
• Grantee: João Paulo Meningue Machado
• Host Institution: Escola de Artes, Ciências e Humanidades (EACH). Universidade de São Paulo (USP). São Paulo , SP, Brazil

Abstract

Offshore outsourcing is a type of production model significantly based in the use of information and communication technology goods (ICT), which has gained much ground in recent decades due to its high productivity. It is a mode of production in which a company hires another company abroad to produce or provide a service in an area that presents greater expertise. Considering the lack of data for evaluation of offshore outsourcing trade among countries and its strong relation with information and communication technology goods, we will estimate the capacity of a country to become a supplier of offshore outsourcing services using data on ICT capacity. The goal of the project is to estimate the productive capacity from its basic determinants, trying to infer the sets of variables relevant and its respective magnitudes. In particular, we seek to infer if the government institution's quality, in the case of the country of the company to be contracted, is also important for the existence of this type of trade. We will estimate binary dependent variable models using a panel data from all countries between 2000 and 2012 from the World Bank. We will also seek to draw a general scenario of this production mode and analyze characteristics of its world trade.