What Will it Take for China to Become a Competitive Force in Offshore Outsourcing? An Analysis of the Role of Transaction Costs in Supplier Selection

Authors

Qu Zhonghua, The Business School, Imperial College, London, South Kensington Campus, London SW7 2AZ, UK
Michael Brocklehurst, The Business School, Imperial College, London, South Kensington Campus, London SW7 2AZ, UK

Document Type

Research Article

Abstract

Using transaction costs theory this paper argues that transaction costs are almost as significant as production costs when it comes to offshore outsourcing and, moreover, that it is in the field of transaction costs where China has been unable to compete with India in the supply of information technology outsourcing. The paper outlines a framework for analysing transaction costs and uses the framework for pinpointing where China is unable to compete. The paper concludes with a review of the policy implications for the Chinese Government.

DOI

10.1080/0268396031000077459

Recommended Citation

Zhonghua, Qu and Brocklehurst, Michael (2003) "What Will it Take for China to Become a Competitive Force in Offshore Outsourcing? An Analysis of the Role of Transaction Costs in Supplier Selection," Journal of Information Technology: Vol. 18: Iss. 1, Article 5.
DOI: 10.1080/0268396031000077459
Available at: https://aisel.aisnet.org/jit/vol18/iss1/5