This paper empirically examines how technology and capital intensity are related with the firm's global sourcing decision. Firm-level data are derived from a survey covering all manufacturing industries in Japan without any firm-size threshold. Firms are disaggregated by their make-or-buy decision (in-house or outsourcing) and by their choice of sourcing location (offshore or domestic). Capital-intensive or R&D-intensive firms tend to source in-house from their FDI affiliates rather than outsourcing to independent suppliers. This paper also confirms that high productivity is related with offshore sourcing. These findings are basically robust even after industry and firm-size are controlled for.
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Paper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion papers with number
07024.
Length: 17 pages Date of creation: Apr 2007 Date of revision: Handle: RePEc:eti:dpaper:07024
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Antràs, Pol & Helpman, Elhanan, 2004.
"Global Sourcing,"
CEPR Discussion Papers
4170, C.E.P.R. Discussion Papers.
[Downloadable!] (restricted)
Other versions:
Pol Antràs & Elhanan Helpman, 2003.
"Global Sourcing,"
NBER Working Papers
10082, National Bureau of Economic Research, Inc.
[Downloadable!] (restricted)
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