Outsourcing and Offshoring of Business Services: How Important is ICT?

17 Pages Posted: 26 Nov 2008

See all articles by Rachel Griffith

Rachel Griffith

Institute for Fiscal Studies (IFS); University of Manchester; Centre for Economic Policy Research (CEPR)

Laura Abramovsky

Institute for Fiscal Studies (IFS)

Date Written: January 29, 2006

Abstract

This paper considers the impact that information and communication technology (ICT) has on firms' choices over organisational form. In particular, the decision over whether to produce in-house or outsource services, and the decision over the location of activity. ICT reduces the transaction and adjustment costs of moving activity outside the firm, and of carrying it out at greater geographic distance. We find that more ICT intensive firms purchase a greater amount of services on the market and they are more likely to purchase offshore than less ICT intensive firms.

Suggested Citation

Griffith, Rachel and Abramovsky, Laura, Outsourcing and Offshoring of Business Services: How Important is ICT? (January 29, 2006). Advanced Institute of Management Research Paper No. 029. Available at SSRN: https://ssrn.com/abstract=1307032 or http://dx.doi.org/10.2139/ssrn.1307032

Rachel Griffith (Contact Author)

Institute for Fiscal Studies (IFS) ( email )

7 Ridgmount Street
London WC1E 7AE
United Kingdom
+44 20 7291 4800 (Phone)
+44 20 7323 4780 (Fax)

University of Manchester ( email )

Arthur Lewis Building
Oxford Road
Manchester, M13 9PL
United Kingdom

HOME PAGE: http://www.ifs.org.uk/people/profile?id=37

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Laura Abramovsky

Institute for Fiscal Studies (IFS) ( email )

7 Ridgmount Street
London, WC1E 7AE
United Kingdom

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