English
Ciência-IUL
Publicações
Descrição Detalhada da Publicação
Título Revista
Economic Modelling
Ano (publicação definitiva)
2010
Língua
Inglês
País
Países Baixos (Holanda)
Mais Informação
Web of Science®
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Abstract/Resumo
This paper examines the impact of uncertainty on offshoring low-skilled tasks. The model shows that greater demand uncertainty adversely affects the expected profit and timing of offshoring. It is also shown that a home-country tax rate deduction increases the volatility of the expected profits, making offshoring appear to be more risky. One policy implication of our results is that, in order to delay relocation of MNE's production from the home country, a government should adopt tax rate deduction rather than a direct subsidy because the former is more economical and effective than the latter.
Agradecimentos/Acknowledgements
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Palavras-chave
Offshoring; Multinational enterprises; Option-pricing model; Fiscal policy
Classificação Fields of Science and Technology
- Economia e Gestão - Ciências Sociais
