Outsourcing tech boosts firm profits but hurts consumers and society.
The article shows that companies may outsource a key part of their production even if it's cheaper to make it themselves. When two companies make different products and compete on price, one might have better technology for making a crucial part than an outside supplier. If the products are similar or the technology gap is small, outsourcing happens. Selling the technology as a patent can show a company is committed to outsourcing. The company that outsources benefits, but consumers and society lose out. Surprisingly, the rival company might make more profit in some cases. This raises concerns about competition policies.