Country-level factors affecting the adoption of outsourcing of logistics functions

Abstract

The outsourcing of logistics has become an increasingly powerful trend in modern enterprises. As a result, there has been an emerging demand for logistics outsourcing service providers across the globe. But with the continually increasing demand for logistics outsourcing services, there is also the increasing question of cross-country differences in the logistics outsourcing adoption. Factors, affecting it, are rarely studied on the cross-country level. This research aims to contribute to the research on country-level factors that affect the logistics outsourcing adoption. The goal of this research is to identify and find out which country-level factors affect logistics outsourcing adoption and to explain why it happens. Using new institutional economics framework five hypotheses are developed and tested, linking efficiency of legal framework, social trust, uncertainty avoidance, Internet penetration and logistics performance index to logistics outsourcing adoption across 15 countries. Insights for academia and practice are highlighted.