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Sectoral adjustment of employment to shifts in outsourcing and trade: evidence from a dynamic fixed effects multinomial logit model

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Author Info
Michael Pfaffermayr (Department of Economics, University of Innsbruck, Innsbruck, Austria)
Peter Egger (University of Munich and CESifo, Munich, Germany)
Andrea Weber (Department of Economics and Finance, Institute for Advanced Studies, Vienna, Austria)

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Abstract

This paper analyzes the effects of trade and outsourcing on the transition probabilities of employment between sectors, using a dynamic multinomial logit framework with fixed effects. The data cover a sample of individual Austrian male workers over the period 1988-2001. Our results strongly support the view that international economic forces are important determinants of labor market turnover. In particular, an increase in the outsourcing intensity negatively affects the probability of staying in or changing into the manufacturing sector, even more so for industries with a comparative disadvantage. Copyright © 2007 John Wiley & Sons, Ltd.

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File URL: http://hdl.handle.net/10.1002/jae.914
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Publisher Info
Article provided by John Wiley & Sons, Ltd. in its journal Journal of Applied Econometrics.

Volume (Year): 22 (2007)
Issue (Month): 3 ()
Pages: 559-580
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Handle: RePEc:jae:japmet:v:22:y:2007:i:3:p:559-580

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Jose Manuel Campa & Linda S. Goldberg, 2001. "Employment Versus Wage Adjustment And The U.S. Dollar," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 477-489, August. [Downloadable!] (restricted)
    Other versions:
  2. Egger, Hartmut & Falkinger, Josef, 2003. "The distributional effects of international outsourcing in a 2 x 2 production model," The North American Journal of Economics and Finance, Elsevier, vol. 14(2), pages 189-206, August. [Downloadable!] (restricted)
  3. Egger, Hartmut & Egger, Peter, 2001. "Cross-border sourcing and outward processing in EU manufacturing," The North American Journal of Economics and Finance, Elsevier, vol. 12(3), pages 243-256, November. [Downloadable!] (restricted)
  4. Kohler, Wilhelm, 2001. "A specific-factors view on outsourcing," The North American Journal of Economics and Finance, Elsevier, vol. 12(1), pages 31-53, March. [Downloadable!] (restricted)
  5. Gene M. Grossman, 1986. "Imports as a Cause of Injury: The Case of the U.S. Steel Industry," NBER Working Papers 1494, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  6. Stiglbauer, Alfred M. & Stahl, Florian & Winter-Ebmer, Rudolf & Zweimüller, Josef, 2002. "Job Creation and Job Destruction in a Regulated Labor Market: The Case of Austria," IZA Discussion Papers 546, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  7. Vivarelli, Marco & Evangelista, Rinaldo & Pianta, Mario, 1996. "Innovation and employment in Italian manufacturing industry," Research Policy, Elsevier, vol. 25(7), pages 1013-1026, October. [Downloadable!] (restricted)
  8. Linda Goldberg & Joseph Tracy & Stephanie Aaronson, 1999. "Exchange Rates and Employment Instability: Evidence from Matched CPS Data," American Economic Review, American Economic Association, vol. 89(2), pages 204-210, May. [Downloadable!] (restricted)
  9. Helmut Hofer & Peter Huber, 2003. "Wage and Mobility Effects of Trade and Migration on the Austrian Labour Market," Empirica, Springer, vol. 30(2), pages 107-125, June. [Downloadable!] (restricted)
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  10. Magnac, Thierry, 2000. "Subsidised Training and Youth Employment: Distinguishing Unobserved Heterogeneity from State Dependence in Labour Market Histories," Economic Journal, Royal Economic Society, vol. 110(466), pages 805-37, October. [Downloadable!] (restricted)
  11. Aiginger, Karl & Winter-Ebmer, Rudolf & Zweimüller, Josef, 1995. "East European Trade and the Austrian Labour Market," CEPR Discussion Papers 1168, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  12. Boeri, Tito & Cramer, Ulrich, 1992. "Employment growth, incumbents and entrants : Evidence from Germany," International Journal of Industrial Organization, Elsevier, vol. 10(4), pages 545-565, December. [Downloadable!] (restricted)
  13. Steven J. Davis & John C. Haltiwanger & Scott Schuh, 1998. "Job Creation and Destruction," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262540932, January.
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Ronald Bachmann & Sebastian Braun, 2008. "The Impact of International Outsourcing on Labour Market Dynamics in Germany," Ruhr Economic Papers 0053, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen. [Downloadable!]
    Other versions:
  2. Daniel Baumgarten, 2009. "International Outsourcing, the Nature of Tasks, and Occupational Stability – Empirical Evidence for Germany," Ruhr Economic Papers 0108, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen. [Downloadable!]
  3. Matthias Deschryvere & Annu Kotiranta, 2008. "Domestic Employment Effects of Offshoring: Empirical Evidence from Finland," Discussion Papers 1166, The Research Institute of the Finnish Economy. [Downloadable!]
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