Browsing by Subject "Incomplete contracts"

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    International Outsourcing: Empirical Evidence from the Netherlands
    (2011) Tuluǧ Ok, S.
    This study examines the results of a fi eld survey on international outsourcing conducted in 2009 in the Netherlands. The research sample is composed of 156 Dutch enterprises from various industries. Empirical evidence shows that reduction of labor costs, improved competitiveness, strategic decisions taken by the group head and reduction in other costs are the main motivations for Dutch fi rms to engage in international outsourcing. Tax and regulatory advantages seem to play a lesser role. The motivations can be grouped into three distinct factors: access to cheaper resources and increasing competition, access to scarce and distinctive resources and reduction of other production costs. The most important impediments turn out to be problems with distance to producers, the need for proximity to existing clients, concerns about the outsourcing operation exceeding expected benefi ts and linguistic/cultural barriers. Violation of patents/intellectual property rights and uncertainty of international standards are not viewed as important issues. The impediments are captured by three different dimensions as indicated by the data: legal and governmental obstacles, human concerns and logistical diffi culties. © 2011 Vilnius Gediminas Technical University (VGTU) Press Technika.
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    To invest or screen efficiently: a potential conflict in relationships governed by incomplete contracts
    (Elsevier BV, 2001) Bac, M.
    We consider a dynamic trade relationship where quality is not contractible and potential sellers retain quality-relevant private information. We show that the presence of an investment technology to improve the incumbent seller's innate quality may impair the efficiency of the screening process. If the conflict is effective, the buyer has to induce an inefficient screening process or reduce the productivity of the investment technology. This conflict suggests that the hold-up problem may be more severe than predicted by models of incomplete contracts that assume complete information. © Elsevier Science B.V.