A Research On The Impact Of Outsourcing-undertaking

With international division's deepening, the undertaking of international outsourcing makes China's manufacturing develop rapidly, but also impacts the trading pattern, comparative advantages and international competitiveness. This paper analyses the level of outsourcing-undertaking and its impacts, based on theoretical and empirical aspects.On theoretical aspect, firstly, we use 2*2 production model to analysis the different departments of four different types of outsourcing, the results show that all the four have been abided by the comparative advantages and the scale economies, and they all impact the location and the slope of the cost curve; but the differences are the labor department's labor-intensive outsourcing could lead into a "comparative advantages traps" and make trade friction, the capital department's capital-intensive outsourcing could improve trading pattern, enhance core competitiveness and ability to imitate, and help climbing the value chain. Secondly, we analysis the impact of outsourcing-undertake to the endowments and comparative advantages, we find outsourcing-undertake changes the total factor density and the comparative advantages of manufactured productsat the same time.On empirical aspect, firstly, we use the input-output matrix method to measure the level of outsourcing-undertaking of China's manufacturing in 1997 and 2002, the results show that, view from the sectors, China's manufacturing sectors have different levels and different speeds, for example, machinery industry, the chemical industry have been at a high level, eiderdown clothing , leather products industry , the food manufacturing and tobacco processing industry have been at a low level; view from the factor density, capital & technology intensive sectors has been at the highest level, and capital-intensive sectors develops fastest; view from intermediate imports and total outputs, capital & technology intensive sector is more likely to dependent on foreign intermediate imports, and the labor-intensive sector is more likely to dependent on local intermediate. Secondly, we contrast the RCA index and the TC index to the outsourcing-undertaking level at the same period, the results show that the outsourcing-undertaking level and the comparative advantage are inter-depended and inter-influenced; but outsourcing-undertaking level has no notable impact to the international competitiveness. Finally, under the previous theoretical and empirical analysis, we present four policy recommendations about outsourcing-undertaking.