IS OFFSHORING AN INTERNATIONAL PROCESS

This article proposes to analyze the applicability of transaction cost economics - TCE (Coase, 1937; Williamson, 1975, 1979) through its characteristic make-or-buy expression, considering the offshoring pace and emerging economy firms. The make-or-buy decision must be flexible enough to explain offshoring characteristics and developed and emerging economy firms scenarios. As secondary objectives, and to show the trail to the main purpose, two research questions were identified and discussed during the paper: Is offshoring process an international movement only from developed countries to emerging economies? Is the main reason of offshoring the looking for low-cost work / activities? To achieve the proposed objectives, the structure of this paper begins with a reasonable or acceptable definition of offshoring. Some reasons (or “the reason”) for the process are also another important starting point. The majority of articles referee the idea that low-cost is the main reason for offshoring, and if it is correct, transaction cost economics seems to be a good basis for our analysis purpose and integrative intention. Also some literature connections between offshoring and TCE are presented and, naturally TCE is presented in highlights for understanding these connections. Ending this section, some different arguments based on newer researches are presented by some authors presenting another perspective as the main reason. After this theoretical approach, a scenario analysis and some discussions are presented based on all possible interactions among firm from developed (DC) and emerging economies (EE) and examples of international corporations are presented to clarify and improve the understanding of our research questions and to build new contributions to international business theory.