Offshoring along the Production Chain
AbstractRecent contributions on offshoring often assume that firms can freely split their production process into separate steps which can be ranked according to the cost savings from producing abroad. We replace this assumption by the notion of a technologically determined sequence of production steps. In our model, cost savings from offshoring fluctuate along the production chain, and moving unfinished goods across borders causes transport costs. We show that, in such a setting, firms may refrain from offshoring even if relocating individual steps would be advantageous. Conversely, small variations in model parameters may lead to a large increase in offshoring activities.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by CESifo Group Munich in its series CESifo Working Paper Series with number 2564.
Date of creation: 2009
Date of revision:
offshoring; international trade; vertical production chain;
Other versions of this item:
- D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
- F10 - International Economics - - Trade - - - General
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
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.:
- Hartmut Egger & Peter Egger, 2004.
"Outsourcing and Trade in a Spatial World,"
DEGIT Conference Papers
c009_025, DEGIT, Dynamics, Economic Growth, and International Trade.
- Geishecker, Ingo & Görg, Holger, 2007.
"Winners and losers: A Micro-level Analysis of International Outsourcing and Wages,"
CEPR Discussion Papers
6484, C.E.P.R. Discussion Papers.
- Ingo Geishecker & Holger Görg, 2008. "Winners and losers: a micro-level analysis of international outsourcing and wages," Canadian Journal of Economics, Canadian Economics Association, vol. 41(1), pages 243-270, February.
- Ronald W. Jones, 2000. "Globalization and the Theory of Input Trade," MIT Press Books, The MIT Press, edition 1, volume 1, number 026210086x, December.
- Feenstra, Robert C. & Hanson, Gordon H., 1997.
"Foreign direct investment and relative wages: Evidence from Mexico's maquiladoras,"
Journal of International Economics,
Elsevier, vol. 42(3-4), pages 371-393, May.
- Robert C. Feenstra & Gordon H. Hanson, 1995. "Foreign Direct Investment and Relative Wages: Evidence from Mexico's Maquiladoras," NBER Working Papers 5122, National Bureau of Economic Research, Inc.
- Arndt, Sven W., 1997. "Globalization and the open economy," The North American Journal of Economics and Finance, Elsevier, vol. 8(1), pages 71-79.
- Robert-Nicoud, Frédéric, 2008. "Offshoring of routine tasks and (de)industrialisation: Threat or opportunity--And for whom?," Journal of Urban Economics, Elsevier, vol. 63(2), pages 517-535, March.
- Venables, Anthony J., 1999. "Fragmentation and multinational production," European Economic Review, Elsevier, vol. 43(4-6), pages 935-945, April.
- Glass, Amy Jocelyn & Saggi, Kamal, 2001. "Innovation and wage effects of international outsourcing," European Economic Review, Elsevier, vol. 45(1), pages 67-86, January.
- Wilhelm Kohler, 2004. "International outsourcing and factor prices with multistage production," Economic Journal, Royal Economic Society, vol. 114(494), pages C166-C185, 03.
- Predrag Bjelic & Ivan Markovic & Ivana Popovic Petrovic, 2012. "Transnational Companies And A Changing Structure Of International Trade," Montenegrin Journal of Economics, Economic Laboratory for Transition Research (ELIT), vol. 8(4), pages 61-77.
- Hess, Sebastian, 2011. "Outsourcing, Regional Trade and Specialization: An Application to in the German Pig Sector," 2011 International Congress, August 30-September 2, 2011, Zurich, Switzerland 114537, European Association of Agricultural Economists.
- Pol Antràs & Davin Chor, 2013.
"Organizing the Global Value Chain,"
Econometric Society, vol. 81(6), pages 2127-2204, November.
- Pol Antras & Davin Chor, 2012. "Organizing the Global Value Chain," Working Papers 25-2012, Singapore Management University, School of Economics.
- Pol Antràs & Davin Chor, 2012. "Organizing the Global Value Chain," NBER Working Papers 18163, National Bureau of Economic Research, Inc.
- Antràs, Pol & Chor, Davin, 2012. "Organizing the Global Value Chain," CEPR Discussion Papers 9018, C.E.P.R. Discussion Papers.
- Arnaud Costinot & Jonathan Vogel & Su Wang, 2011.
"An Elementary Theory of Global Supply Chains,"
NBER Working Papers
16936, National Bureau of Economic Research, Inc.
- Su Wang & Jonathan Vogel & Arnaud Costinot, 2011. "An Elementary Theory of Global Supply Chains," 2011 Meeting Papers 95, Society for Economic Dynamics.
- Arnaud Costinot & Jonathan E. Vogel & Su Wang, 2011. "An Elementary Theory of Global Supply Chains," CESifo Working Paper Series 3402, CESifo Group Munich.
- Silvia Rocha-Akis, 2012. "The Pain and Gain of Offshoring: The Effects of Tax Progression in a Segmented Labour Market," CESifo Working Paper Series 3739, CESifo Group Munich.
- Mandal, Biswajit & Marjit, Sugata & Nakanishi, Noritsugu, 2013. "Time Zones, Factor Prices and Inflow of Educational Capital: Changing Sectoral Composition," MPRA Paper 50883, University Library of Munich, Germany.
- Kikuchi, Toru & Marjit, Sugata & Mandal, Biswajit, 2011.
"Trade with Time Zone Differences: Factor Market Implications,"
37931, University Library of Munich, Germany, revised 2012.
- Toru Kikuchi & Sugata Marjit & Biswajit Mandal, 2013. "Trade with Time Zone Differences: Factor Market Implications," Review of Development Economics, Wiley Blackwell, vol. 17(4), pages 699-711, November.
- Kikuchi, Toru & Marjit, Sugata, 2011. "Trade with time zone differences: factor market implications," MPRA Paper 30788, University Library of Munich, Germany.
- Toru Kikuchi & Sugata Marjit & Biswajit Mandal, 2012. "Trade with Time Zone Differences:Factor Market Implications," Discussion Papers Series 462, School of Economics, University of Queensland, Australia.
- Wilhelm Kohler & Jens Wrona, 2010. "Offshoring Tasks, yet Creating Jobs?," CESifo Working Paper Series 3019, CESifo Group Munich.
- Philipp Harms & Jaewon Jung & Oliver Lorz, 2014.
"Offshoring and Sequential Production Chains: A General-Equilibrium Analysis,"
14.01, Swiss National Bank, Study Center Gerzensee.
- Philipp Harms & Jaewon Jung & Oliver Lorz, 2014. "Offshoring and Sequential Production Chains: A General-Equilibrium Analysis," MAGKS Papers on Economics 201402, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
- Escaith, Hubert & Lindenberg, Nannette & Miroudot, Sébastien, 2010. "International Supply Chains and Trade Elasticity in Times of Global Crisis," MPRA Paper 20478, University Library of Munich, Germany.
- Hess, Sebastian, 2011. "Outsourcing Decisions Of Pig Producers In Baden-Württemberg," 51st Annual Conference, Halle, Germany, September 28-30, 2011 114509, German Association of Agricultural Economists (GEWISOLA).
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Julio Saavedra).
If references are entirely missing, you can add them using this form.