Influencing Factors Of Offshore Service Outsourcing In China

China once successfully undertook manufacturing outsourcing and became “theworld’s factory”. Now China’s service outsourcing is in its infancy and serviceoutsourcing contributes to the globalization of China’s service industry and upgrade ofindustry structures. The purpose of this thesis is to analyze factors influencingundertaking of service outsourcing and manufacturing outsourcing and explore whetherexperience and theories of manufacturing can be directly applied to service outsourcing.This thesis firstly adopts the qualitative study method and puts forward factorsinfluencing undertaking of service outsourcing and manufacturing outsourcing based onprevious researches and proposes four hypotheses. Then the paper adopts thequantitative study method and constructs regression models to analyze these factors andverify hypotheses. And the empirical results show that FDI, human capital andintellectual property rights protection are the major influencing factors of offshoreservices outsourcing while market size, labor cost, trade openness, transportationinfrastructure and logistics efficiency are the main influencing factors of manufacturingoutsourcing. Service outsourcing and manufacturing outsourcing are so different thatmanufacturing outsourcing’s theories cannot be directly applied to service outsourcing.Based on the findings, the thesis finally puts forward suggestions for China to promotethe development of offshore service outsourcing.