The Advantages of Outsourcing in Terms of Information Management

University of Siena, Economics Working Paper No. 370

19 Pages Posted: 10 Apr 2003

See all articles by Alessandro Innocenti

Alessandro Innocenti

University of Siena - Department of Social, Political and Cognitive Sciences; University of Siena - Labsi Experimental Economics Laboratory

Sandrine Labory

University of Bergamo - Department of Economics

Date Written: November 2002

Abstract

Subcontracting and, more generally, productive outsourcing increasingly characterise industrial organisation. The aim of this paper is to analyse information management in different cases of supplier networks, in order to provide hypotheses on the advantages of networks over other governance forms of suppliers' relationships. We review some empirical literature and compare specific cases. First, networks characterised by a large firm and more or less dependent suppliers is examined, in Japan, France and Italy. Second, outsourcing in systems of small firms, where power is more equally distributed along the productive process, is analysed for the same three countries. Finally, we derive theoretical insights by arguing that the study of information flows is key to explain such phenomena. More precisely, the advantages of outsourcing are due both to the particular way various types of information, on technology or on market conditions, are shared in the network and to the "governance" of the network, that has to be characterised by a more equal distribution of contractual power between suppliers and users.

Keywords: network, information, outsourcing, subcontracting

JEL Classification: D23, L11, L22

Suggested Citation

Innocenti, Alessandro and Labory, Sandrine, The Advantages of Outsourcing in Terms of Information Management (November 2002). University of Siena, Economics Working Paper No. 370. Available at SSRN: https://ssrn.com/abstract=368140 or http://dx.doi.org/10.2139/ssrn.368140

Alessandro Innocenti (Contact Author)

University of Siena - Department of Social, Political and Cognitive Sciences ( email )

Via Roma 56
Siena, Siena I-53100
Italy
39 338 5724318 (Phone)
39 0577 232793 (Fax)

HOME PAGE: http://www.labsi.org/innocenti/

University of Siena - Labsi Experimental Economics Laboratory ( email )

Piazza Mattioli 10
Siena, Siena 53100
Italy

HOME PAGE: http://www.labsi.org

Sandrine Labory

University of Bergamo - Department of Economics ( email )

Piazza Rosate 2
I-24100 Bergamo, 24127
Italy
0352052543 (Phone)

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