Chen, Yongmin; Ishikawa, Jota; Yu, Zhihao - Carleton University, Department of Economics - 2002
This paper develops a model of strategic outsourcing. With trade liberalization in the intermediate-product market, a … domestic firm for a final good. This has a strategic effect on competition. Unlike the outsourcing motivated by cost saving …, the strategic outsourcing has a collusive effect that could raise the prices of both intermediate and final goods. Trade …