Follow the Intellectual Property, How does Industry pay Programmers' Salaries when they move the related IP rights to offshore taxhavens?"

In the ongoing discussion about offshoring in the computer and data-processing industries, the 2006 ACM report Globalization and Offshoring of Software addressed job shifts due to globalization in the software industry. But jobs represent only half of the labor and capital equation in business. In today’s high-technology industries, intellectual property (IP) supplies the other half, the capital complement. Offshoring IP always accompanies offshoring jobs and, while less visible, may be a major driver of job transfer. The underlying economic model—involving ownership of profits, taxation, and compensation of workers from the revenue their products generate—has not been explicated and is largely unknown in the computer science community. This article presents the issue of software income allocation and the role IP plays in offshoring. It also tries to explain why computer experts lack insight into the economics of software, from investments made, to profits accumulated, to capital becoming available for investment in new projects and jobs.Offshoring, offshore outsourcing, tax havens, job loss, intellectual property, tax avoidance, non-routine profits

Follow the Intellectual Property, How does Industry pay Programmers' Salaries when they move the related IP rights to offshore taxhavens?"

In the ongoing discussion about offshoring in the computer and data-processing industries, the 2006 ACM report Globalization and Offshoring of Software addressed job shifts due to globalization in the software industry. But jobs represent only half of the labor and capital equation in business. In today’s high-technology industries, intellectual property (IP) supplies the other half, the capital complement. Offshoring IP always accompanies offshoring jobs and, while less visible, may be a major driver of job transfer. The underlying economic model—involving ownership of profits, taxation, and compensation of workers from the revenue their products generate—has not been explicated and is largely unknown in the computer science community. This article presents the issue of software income allocation and the role IP plays in offshoring. It also tries to explain why computer experts lack insight into the economics of software, from investments made, to profits accumulated, to capital becoming available for investment in new projects and jobs

Determining Software Investment Lag

The investments needed to bring a software project to the market are substantial and can extend over several years. Managing software development requires not only technical expertise, but communication with funders and economists. This paper presents methods to estimate a parameter which captures the effective investment time, lag. The lag parameter is useful in assessing progress towards the goal of having a quality product, while scheduling resources, assessing the risk, considering options, capitalization of investments, and predicting taxation consequences. The paper presents the lag estimation methods for a new product, for additional versions of a product, and for complete product replacement