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Time Zones, Shift Working and Outsourcing through Communications Networks

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  • Matsuoka, Yuji
  • Fukushima, Marcelo

Abstract

We build a trade model with two countries located in different time zones, a monopolistically competitive sector in which production requires differentiated goods produced using day and night labor, and shift working disutility. Consumers choose between working at a day shift or a night shift and firms may choose to “virtually” outsource foreign day time labor by using communications services. We found that the higher the disutility of working at night is, the smaller is the number of varieties produced. Trade is beneficial only under certain concavity and cost conditions. The higher the disutility of working at night, the larger can be the gains from trade.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 13355.

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Date of creation: Feb 2009
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Handle: RePEc:pra:mprapa:13355

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Related research

Keywords: Communications networks; shift work; time zones; outsourcing;

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References

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  1. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
  2. Toru Kikuchi, 2009. "Time Zones as a Source of Comparative Advantage," Review of International Economics, Wiley Blackwell, vol. 17(5), pages 961-968, November.
  3. Lanfranchi, Joseph & Ohlsson, Henry & Skalli, Ali, 2001. "COMPENSATING WAGE DIFFERENTIALS AND SHIFT WORK PREFERENCES. Evidence from France," Working Papers in Economics 55, University of Gothenburg, Department of Economics.
  4. Marjit, Sugata, 2007. "Trade theory and the role of time zones," International Review of Economics & Finance, Elsevier, vol. 16(2), pages 153-160.
  5. Fukushima, Marcelo & Kikuchi, Toru, 2008. "A Simple Model of Trade with Heterogeneous Firms and Trade Policy," MPRA Paper 9573, University Library of Munich, Germany.
  6. Kostiuk, Peter F, 1990. "Compensating Differentials for Shift Work," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 1054-75, October.
  7. Ethier, Wilfred, 1979. "Internationally decreasing costs and world trade," Journal of International Economics, Elsevier, vol. 9(1), pages 1-24, February.
  8. Richard G. Harris, 1995. "Trade and Communication Costs," Canadian Journal of Economics, Canadian Economics Association, vol. 28(s1), pages 46-75, November.
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Cited by:
  1. Toru Kikuchi & Ngo Van Long, 2011. "Shift Working and Trade in Labor Services with Time Zone Differences," CESifo Working Paper Series 3542, CESifo Group Munich.
  2. Kikuchi, Toru & Marjit, Sugata & Mandal, Biswajit, 2011. "Trade with Time Zone Differences: Factor Market Implications," MPRA Paper 37931, University Library of Munich, Germany, revised 2012.

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