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Outstanding Outsourcers: A Firm- and Plant-Level Analysis of Production Sharing

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  • Christopher Johann Kurz
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    Abstract

    This paper examines the differences in characteristics between outsourcers and nonoutsourcers with a particular focus on productivity. The measure of outsourcing comes from a question in the 1987 and 1992 Census of Manufactures regarding plant-level purchases of foreign intermediate materials. There are two key findings. First, outsourcers are “outstanding.” That is, all else equal, outsourcers tend to have premia for plant and firm characteristics, such as being larger, more capital intensive, and more productive. One exception to this outsourcing premia is that wages tend to be the same for both outsourcers and non-outsourcers. Second, outsourcing firms, but not plants, have significantly higher productivity growth.

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    File URL: ftp://ftp2.census.gov/ces/wp/2006/CES-WP-06-02.pdf
    File Function: First version, 2006
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    Bibliographic Info

    Paper provided by Center for Economic Studies, U.S. Census Bureau in its series Working Papers with number 06-02.

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    Length: 38 pages
    Date of creation: Jan 2006
    Date of revision:
    Handle: RePEc:cen:wpaper:06-02

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    References

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    1. J. Bradford Jensen & Andrew Bernard, 2005. "Firm Structure, Multinationals, and Manufacturing Plant Deaths," Working Papers 05-18, Center for Economic Studies, U.S. Census Bureau.
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    Citations

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    Cited by:
    1. Joachim Wagner, 2009. "Offshoring and firm performance: Self-selection, effects on performance, or both?," Working Paper Series in Economics 153, University of Lüneburg, Institute of Economics.
    2. B. Atrostic, 2008. "Measuring U.S. innovative activity: business data at the U.S. Census Bureau," The Journal of Technology Transfer, Springer, vol. 33(2), pages 153-171, April.
    3. Andersson, Linda & Karpaty, Patik, 2012. "Firm Level Effects of Offshoring of Goods and Services on Relative Labor Demand," Working Papers 2013:2, Örebro University, School of Business.
    4. Van Assche, Ari & Schwartz, Galina A., 2010. "Input specificity and global sourcing," Journal of the Japanese and International Economies, Elsevier, vol. 24(1), pages 69-85, March.
    5. Martin Borowiecki & Bernhard Dachs & Doris Hanzl-Weiss & Steffen Kinkel & Johannes Pöschl & Magdolna Sass & Thomas Christian Schmall & Robert Stehrer & Andrea Szalavetz, 2012. "Global Value Chains and the EU Industry," wiiw Research Reports 383, The Vienna Institute for International Economic Studies, wiiw.
    6. Ben S. Bernanke, 2006. "The new economic geography: opening remarks," Proceedings - Economic Policy Symposium - Jackson Hole, Federal Reserve Bank of Kansas City, pages 1-14.
    7. João Amador & Sónia Cabral, 2008. "International Fragmentation of Production in the Portuguese Economy: What do Different Measures Tell Us?," Working Papers w200811, Banco de Portugal, Economics and Research Department.
    8. Stefano Federico, 2010. "Outsourcing versus integration at home or abroad and firm heterogeneity," Empirica, Springer, vol. 37(1), pages 47-63, February.

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