Kiel Working Papers, Kiel Institute for World Economics
No 1786:
Offshoring, Domestic Outsourcing, and Productivity: Evidence for a Number of European Countries
Tillmann Schwörer
Abstract: The economic effects of offshoring have been subject to
extensive empirical analysis in the past, but many studies have not
accurately distinguished between offshoring, domestic outsourcing, and the
substitution of domestic by foreign suppliers. In this study I provide
stylized facts on offshoring in Europe between 1995 and 2008 taking into
account this distinction. I show that service inputs have been offshored
and domestically outsourced, whereas material inputs have been either
offshored or moved from domestic to foreign suppliers. The strong overall
decline in the share of internal production evokes the question whether
this has led to productivity gains within firms. I address this question by
combining industry-level data on offshoring and domestic outsourcing with a
firm panel. I find that offshoring of non-core activities has led to
productivity gains whereas offshoring of core activities and domestic
outsourcing have had no such effects. The estimated productivity gains are
in particular driven by offshoring to low-wage countries and by the gains
of multinational firms
Keywords: offshoring, domestic outsourcing, productivity; (follow links to similar papers)
JEL-Codes: F23,; D24,; L24,; L60; (follow links to similar papers)
31 pages, July 2012
Before downloading any of the electronic versions below
you should read our statement on
copyright.
Download GhostScript
for viewing Postscript files and the
Acrobat Reader for viewing and printing pdf files.
Downloadable files:
KWP%201786.pdf 
Download Statistics
Report other problems with accessing this service to Sune Karlsson ()
or Helena Lundin ().
Programing by
Design Joakim Ekebom
