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Product Cycle, Contractibility and Global Sourcing

Author

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  • Xiaoping Chen

    (Division of Economics, Nanyang Technological University, 14 Nanyang Drive, Singapore 637332.)

  • Yi Lu

    (Division of Economics, Nanyang Technological University, 14 Nanyang Drive, Singapore 637332.)

  • Lianming Zhu

    (Kyoto University, Japan)

Abstract

This paper examines the organization structure of global sourcing over the product cycle. The paper combines a new product list dataset and China's customs data. The analysis finds that multinationals first produce within their foreign subsidiaries, and when the product matures, they start to outsource their production to external foreign suppliers. Global outsourcing appears later along the product cycle when the contractibility is better.

Suggested Citation

  • Xiaoping Chen & Yi Lu & Lianming Zhu, 2016. "Product Cycle, Contractibility and Global Sourcing," Economic Growth Centre Working Paper Series 1604, Nanyang Technological University, School of Social Sciences, Economic Growth Centre.
  • Handle: RePEc:nan:wpaper:1604
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    References listed on IDEAS

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    More about this item

    Keywords

    Global sourcing; Product cycle; Contractibility; Difference-in-difference-in-differences estimation;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights

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