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Purpose – The purpose of this paper is to examine recent trends in R&D offshoring by US multinational enterprises (MNEs) against a well-established conceptual framework derived from transaction cost and internalization theories, as well as challenges to it. Design/methodology/approach – The paper develops and tests a parsimonious model of cross-country variation in R&D performed by affiliates of MNEs based on a 31-country, 15-year dataset of US non-bank majority-owned foreign affiliates (MOFAs). Findings – Consistent with the implications of transaction cost and internalization frameworks, the findings show that the location of R&D offshoring is significantly determined by ownership of physical assets by MNEs in the host country and host country technological capability. Practical implications – R&D offshoring can enhance the quality and the quantity of knowledge flows between home country and host country R&D centers. The resulting positive knowledge spill-over effects can increase the welfare and productivity of an MNE and its home country in the long run. Originality/value – The paper provides a comprehensive explanation for MNEs' R&D offshoring based on transaction costs, internalization framework and technological factors. [ABSTRACT FROM AUTHOR]

Purpose -- Most debates concerning outsourcing offshore in recent years have been politically oriented and based on casual observations. The purpose of this paper is to provide a clear economic understanding of the subject and to present offshoring in the context of globalization and in a more integrated world economy. Design/methodology/approach -- This paper is designed in a coherent way to provide the reader with an overview, scope, benefits, and costs of outsourcing offshore and suggest some appropriate policies to navigate in a globally interdependent and competitive environment. Findings -- Outsourcing offshore is largely irreversible and the USA or other countries must invest heavily in ways to boost domestic workers' productivity and to manage workers' transitions to more competitive employment. This paper also provides evidence that, in the long run, outsourcing offshore is beneficial for the economy as a whole. Originality/value -- This paper delineates that outsourcing offshore is consistent with the theory of comparative advantage and value maximizing objectives of firms. It also provides insights for politicians and casual observers about critical aspects of outsourcing offshore. [ABSTRACT FROM AUTHOR]

Abstract Business environments in the last decade have changed dramatically in the United States. Competition from companies with established world-class techniques has placed heavy pressure on companies not quite as prepared for new realities. In the last ten years, leading companies with traditionally high market shares and profits have found themselves in a panic, implementing radical changes and new ways of doing things in order to survive in an environment where seemingly only the leanest, and most responsive, survive.This paper provides an analysis of how a medium-sized company has reacted to a changing marketplace in order to remain competitive. Problems faced by this company in the last ten years are typical of the problems many firms in the US have faced: (1) competition in a global market, trends toward automated, high-volume production and standardization, (2) rapid technology changes and their effect on human resources, and (3) advances in quality expectations. The most noticeable achievement by this company has been made possible by the technology exchange with its new parent company. The successful implementation of key automated manufacturing lines in high-volume markets has set the pace for what the future business climate will demand. [ABSTRACT FROM AUTHOR]