When International Service Outsourcing Begin: A Transaction Cost Economics Perspective

Team cooperation based on the differences of human capitals is a typical feature of international service outsourcing. This article analyzes the effect of training cost and human capital level on the team´s cooperative decision and benefits of service outsourcing. The research shows that transnational team´s training cost is an important variable of decision-making for international outsourcing. Meanwhile, on different conditions of team cooperation cost, the effects of training cost on the outsourcer´s income are different. As the level of human capital of the contractor increases, the outsourcing country gains more income so that it can implement service outsourcing with more incentives.