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Contracting out and labor demand elasticities

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Author Info
GORG, Holger
PICARD, Pierre
STROBL, Eric

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Abstract

We examine the relationship between contracting out and the wage elasticity of labor demand in outsourcing plants. A simple theoretical model suggests that firms engaged in contracting out have lower wage elasticities. Estimating plant level dynamic labor demand equations for Irish manufacturing we find evidence supportive of this.

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Publisher Info
Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 2005082.

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Date of creation: 01 Nov 2005
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Handle: RePEc:cor:louvco:2005082

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Related research
Keywords: outsourcing; contracting out; labor demand; elasticities;

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