The Structures Of China's Offshore Service Outsourcing

The offshore service outsourcing is one of the new industries emerged from the new stage of development of the international division of labor restructuring in the trend of economic globalization, which has become an active participator from the developing countries into the global value chain integration and an significant industry in the developed countries to undertake the global industrial transfer, especially towards the emerging market countries in Latin America and the Asia Pacific regions. In recent years, China's offshore outsourcing has experienced rapid development, with an average annual growth rate of over60percent in the fourth consecutive years after the2008Global Financial Crisis, jumping onwards the world's second largest economy of undertaking offshore services outsourcing from2011in the case of the passive world economy. Obviously, the offshore sevice outsourcing has become a new bright spot in China's economic growth.But there exposed several problems in the rapid development of China's offshore service outsourcing. For example, those factors like the rather thin margins owing to the long-term low end of the global value chain of China, rising costs of the operation and management of enterprises as well as the imprudent and extensive modes of development which can not meet the demands of high-end customers, has become a bottleneck to constrain the smooth transition and upgrade on China's offshore services outsourcing.In this paper, with the perspective of structure, the theories and methods international trade, regional economics, industrial economics and other related disciplines were under unilization through both the static and dynamic analysis to explore China's Offshore Services outsourcing trends, identify the drives contributing to the changes in the structure, trends and relationships between the industrial promotion and China's economic development, and finally put forward suggestions to optimize the structure of China's offshore outsourcing. Generally, this paper mainly includes the following sections:The first chapter is an introduction. This chapter includes the research background, problems to be solved, significance, research content and methods, research objectives, innovation and weaknesses and so on.The second chapter is the relevant theories and literature review. This chapter includes the development of offshore outsourcing services related to the theories of international trade, regional economics, industrial economics, as well as a brief overview of the theory and recent literatures.The third chapter is the study of the business structure of China's offshore service outsourcing. With the analysis of the internal and external pressures for transformation and upgrading faced by China's traditional offshore outsourcing, This chapter has found that offshore outsourcing has strided towards the brand new technique direction of offshore cloud outsourcing under the impetus of cloud computing and other emerging technologies. Compared to traditional offshore outsourcing, offshore cloud outsourcing enjoys two advantages of both raising the technolegical rent of the value chain and significantly reducing operating and service costs. This chapter systematically describes the content, advantages and upgrade paths of offshore cloud outsourcing, proposed the upgrading modes on the theoretical basis of the global value chain, while the two orientals of offshore cloud outsourcing development. Finally, an empirical model has been established to analyze the positive impact of the market structure of offshore cloud outsourcing on its market performance.The fourth chapter is the study of the regional structure of China's offshore service outsourcing. This chapter introduces the regional innovation systems theory to analyze the impact of the factors and their interactions of the technological innovation elements of the enterprises, universities and governments on the promotion of offshore service outsourcing in various provinces. This chapter found that investments from the cooperation of enterprises and universities has no positive influence on offshore service outsourcing; the technological innovation activities of R&D and highly educated personnel has significant positive correlation and contribution of a high degree with the local development of offshore service outsourcing; The efficiency of RIS has lagged positive impact on offshore service outsourcing; the promotion of offshore service outsourcing is significantly affected by location factors.The fifth chapter is the study of the policy structure of China's offshore service outsourcing. This chapter builds the trilemma model up to analyze the influence of monetary independence, exchange stability and financial market openness. Data from46economies, including14Emerging Market Countries have been used to find out how the change of the choices of policies influenced the increase of the revenue and the volatility of offshore. The findings of this chapter are (1) monetary independence has no significant impact on both offshore outsourcing and its volatility in total EME, but significantly positive in the Asian EME;(2)the floating exchange rate regimes has positive impact on the development and volatility of offshore;(3)financial market liberalization raises both the growth and volatility, however, robust financial market system must work as guarantee; the Complete Capital flows of emerging market countries has no significant or significantly negative impact on the offshore outsourcing revenue growth, but positive on the abnormal volatility of the revenue;(4)If China maintained monetary independence, meanwhile, steadily persisted floating exchange rate system and the gradual liberalization of the financial markets, those measures would promote the growth of offshore outsourcing revenue drasticly.Finally, in the concluding section of this article, the arguments on the main contents of this paper has been summarized, and appropriate policy recommendations has been proposed.