Home or Overseas? An Analysis of Sourcing Strategies Under Competition

@article{Wu2014HomeOO,
  title={Home or Overseas? An Analysis of Sourcing Strategies Under Competition},
  author={Xiaole Wu and Fuqiang Zhang},
  journal={Management Science},
  year={2014},
  volume={60},
  pages={1223-1240}
}
M by the recent backshoring trend, this paper studies a sourcing game where competing firms may choose between efficient sourcing (e.g., sourcing from overseas) and responsive sourcing (e.g., sourcing from a home country). Efficient sourcing usually provides a cost advantage, whereas responsive sourcing allows a firm to obtain more accurate demand information when making procurement decisions. By characterizing the equilibrium outcome, we find some interesting results driven by the strategic… CONTINUE READING
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