@TechReport{iza:izadps:dp4063, author={Koskela, Erkki and König, Jan}, title={Can Profit Sharing Lower Flexible Outsourcing? A Note}, year={2009}, month={Mar}, institution={Institute of Labor Economics (IZA)}, address={Bonn}, type={IZA Discussion Paper}, number={4063}, url={https://www.iza.org/index.php/publications/dp4063}, abstract={We analyze the following question associated with flexible outsourcing under imperfect domestic labour market: How does the implementation of profit sharing influence flexible outsourcing? We show that in general profit sharing has a negative effect on low skilled wage and thus an outsourcing decreasing character. However due to labour union determination of effort a constant effort level will result so that in this case firm's optimal choice of profit sharing is zero.}, keywords={flexible outsourcing;profit sharing;labour market imperfection}, }