Micro and macro level impacts of offshore outsourcing are far from clear. Thus there are some well-founded rationales for and against offshore outsourcing as well as a number of misinformed and ill guided viewpoints. Using institutional theory as a lens, this paper analyzes the drivers of offshore business process and information technology outsourcing. We examine the mechanisms by which regulative rules, social rules, culturally supported habits and subconsciously accepted rules and customs influence assessment, selection as well as continuation of outsourcing projects. Managerial and policy implications are discussed and directions for future research have been suggested.
