Offshoring is the relocation (or location) is the economic transfer of the activities, capital and jobs made by an international company in a region of the world where in may use a competitive advantage because of:
- lower costs (inexpensive labor, better access to natural resources, lower taxes, less demanding social and environmental regulations);
- a business cluster, or at least more qualified personnel;
- a better suited infrastructure or a more attractive environment.
Looking forward to write a good research paper on offshoring you must know that relocation, and its opposite the location are two possible choices of offshoring of production of goods and services.
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As a fundamental factor in the spatial planning, it is the field of study of economic geography. For companies, this choice is based on the attractiveness of a region. For governments, the choice of location is based on other criteria often opposed such as tax and social revenues, full employment, economic and technical synergy, population distribution, the use of existing infrastructure and equipment, etc.
The term collocation is a neologism used since December 2012 by the former French Prime Minister Jean-Marc Ayrault to not use the term “relocation,” which has become too unpopular as synonymous with rising unemployment and social dumping.
Offshoring is the abandonment of a domestic production activity, the transfer of this activity to a unit of production abroad and import of the part of the production produced abroad for national or local market.
According to Philippe Villemus, author of the book Offshoring, will we still have jobs tomorrow? (Seuil, 2005), “offshoring is the separation between the places of production and consumption, which means that the products are manufactured in a different place from where they are consumed.”
On the thorny issue of definition, Brahim Labari, Moroccan sociologist who dedicated his doctoral thesis in sociology to this issue, writes: “The complexity of such a definition is due to the multiplicity of related forms, such as foreign direct investment or share in a local company. It is also due to the importance of offshoring according to the sector concerned. There is a difference between a subsidiary of a large computer manufacturing company and a unit making costumes or toys. The impact is uneven both in terms of jobs lost here and won there, or regarding the ability of the company to face competition. It is customary to begin with the etymology because it already gives an indication of the term and what it is made of and what it returns.
Etymologically, this change of a “local” to another considered more profitable. The suffix “local” is used to include both transfers from a city or region to another within the same country, as from a country to another, even from one continent to another. In its strict interpretation, the term “offshoring” means the closing of a plant at the national level and its transfer abroad followed the reimportation of production.
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