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International Outsourcing and Individual Job Separations

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Author Info
Jakob Roland Munch (Department of Economics, University of Copenhagen)

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Abstract

This paper studies the effects of international outsourcing on individual transitions out of jobs in the Danish manufacturing sector for the period 1992-2001. Estimation of a single risk duration model, where no distinction is made between different types of transitions out of the job, shows that outsourcing has a clear significant positive effect on the job separation rate, but the effect corresponds to a limited number of lost jobs. A competing risks duration model that distinguishes between job-to-job and job-to-unemployment transitions is also estimated. Outsourcing is found to increase the unemployment risk of workers and in particular low-skilled workers, but again the quantitative impact is not dramatic. Outsourcing also increases the job change hazard rate and mostly so for high-skilled workers.

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Paper provided by University of Copenhagen. Department of Economics in its series Discussion Papers with number 05-11.

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Length: 15 pages
Date of creation: Aug 2005
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Handle: RePEc:kud:kuiedp:0511

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Related research
Keywords: international outsourcing job separations competing risks duration model

Find related papers by JEL classification:
F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
J68 - Labor and Demographic Economics - - Mobility, Unemployment, and Vacancies - - - Public Policy
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data
C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis

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References listed on IDEAS
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. Sven W. Arndt, 1997. "Globalization and the Open Economy," Working Papers 9701, Lowe Institute of Political Economy. [Downloadable!]
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  2. Carl Davidson & Steven Matusz, 2005. "Trade and Turnover: Theory and Evidence," International Trade 0503009, EconWPA. [Downloadable!]
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  3. Heckman, James & Singer, Burton, 1984. "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data," Econometrica, Econometric Society, vol. 52(2), pages 271-320, March. [Downloadable!] (restricted)
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    Other versions:
  5. Venables, Anthony J., 1999. "Fragmentation and multinational production," European Economic Review, Elsevier, vol. 43(4-6), pages 935-945, April. [Downloadable!] (restricted)
  6. Giuseppe Nicoletti & Stefano Scarpetta & Olivier Boylaud, 2000. "Summary Indicators of Product Market Regulation with an Extension to Employment Protection Legislation," OECD Economics Department Working Papers 226, OECD Economics Department. [Downloadable!]
  7. Egger, Peter & Pfaffermayr, Michael & Weber, Andrea, 2003. "Sectoral Adjustment of Employment: The Impact of Outsourcing and Trade at the Micro Level," Economics Series 145, Institute for Advanced Studies. [Downloadable!]
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  8. Geishecker, Ingo & Gorg, Holger, 2005. "Do unskilled workers always lose from fragmentation?," The North American Journal of Economics and Finance, Elsevier, vol. 16(1), pages 81-92, March. [Downloadable!] (restricted)
  9. Sueyoshi, Glenn T., 1992. "Semiparametric proportional hazards estimation of competing risks models with time-varying covariates," Journal of Econometrics, Elsevier, vol. 51(1-2), pages 25-58. [Downloadable!] (restricted)
  10. Robert C. Feenstra & Gordon H. Hanson, 1996. "Globalization, Outsourcing, and Wage Inequality," NBER Working Papers 5424, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  11. Ingo Geishecker, 2002. "Outsourcing and the Demand for Low-skilled Labour in German Manufacturing : New Evidence," Discussion Papers of DIW Berlin 313, DIW Berlin, German Institute for Economic Research. [Downloadable!]
  12. Royalty, Anne Beeson, 1998. "Job-to-Job and Job-to-Nonemployment Turnover by Gender and Education Level," Journal of Labor Economics, University of Chicago Press, vol. 16(2), pages 392-443, April. [Downloadable!] (restricted)
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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. Ingo Geishecker & Holger Görg & Jakob Roland Munch, 2008. "Do Labour Market Institutions Matter? : Micro-Level Wage Effects of International Outsourcing in Three European Countries," SOEPpapers 81, DIW Berlin, The German Socio-Economic Panel (SOEP). [Downloadable!]
    Other versions:
  2. Ingo Geishecker & Ingo Geishecker & Jakob Roland Munch, 2007. "Do Labour Market Institutions Matter? Micro-level Wage Effects of International Outsourcing in Three European Countries," EPRU Working Paper Series 07-03, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics (formerly Institute of Economics). [Downloadable!]
    Other versions:
  3. Ronald Bachmann & Sebastian Braun, 2008. "The Impact of International Outsourcing on Labour Market Dynamics in Germany," SFB 649 Discussion Papers SFB649DP2008-020, Sonderforschungsbereich 649, Humboldt University, Berlin, Germany. [Downloadable!]
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