Kiel Working Papers, Kiel Institute for World Economics
No 1627:
Web Switching and International Outsourcing: A Matching Approach
Aoife Hanley and Ingrid Ott
Abstract: Formulating a model comprising transportation, uncertainty
and price, we describe how Web procurement is likely to boost volumes of
international services vs. materials inputs. Using panel data for over
2,000 firms, we find that Web procurement increases international services
outsourcing by between 1.6 and 2.5 percent for the FE and D-in-D matching
estimators. These values are comparable to those obtained by Bartel et al.
(2005) using different methodologies and US aggregate data. Although no
existing work has yet reported effects for international materials
outsourcing we find that Web procurement decreases international materials
outsourcing by between 2.2 and 3.7 percent
Keywords: International outsourcing, heterogeneous inputs, uncertainty, price, transportation costs, propensity score matching; (follow links to similar papers)
JEL-Codes: L23,; R34; (follow links to similar papers)
29 pages, June 2010
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