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Offshoring Domestic Jobs

Title data

Egger, Hartmut ; Kreickemeier, Udo ; Wrona, Jens:
Offshoring Domestic Jobs.
In: Journal of International Economics. Vol. 97 (September 2015) Issue 1 . - pp. 112-125.
ISSN 0022-1996
DOI: https://doi.org/10.1016/j.jinteco.2015.03.010

Official URL: Volltext

Abstract in another language

We develop a two-country general equilibrium model, in which heterogeneous firms offshore routine tasks to a low-wage host country. In the presence of fixed costs for offshoring the most productive firms self-select into offshoring, which leads to a reallocation of domestic labor towards less productive uses if offshoring costs are high. As a consequence domestic welfare may fall. The reallocation effect is reversed and domestic welfare rises if offshoring costs are low. The aggregate income distribution, comprising wages and entrepreneurial incomes, becomes more unequal with offshoring.

Further data

Item Type: Article in a journal
Refereed: Yes
Keywords: Offshoring; Heterogeneous firms; Income inequality
Institutions of the University: Faculties > Faculty of Law, Business and Economics > Department of Economics > Chair Economics II
Faculties > Faculty of Law, Business and Economics
Faculties > Faculty of Law, Business and Economics > Department of Economics
Result of work at the UBT: Yes
DDC Subjects: 300 Social sciences > 330 Economics
Date Deposited: 25 Jan 2016 08:46
Last Modified: 13 May 2016 07:28
URI: https://eref.uni-bayreuth.de/id/eprint/29899