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Offshoring and the Skill Structure of Labour Demand

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  • Gaaitzen De Vries
  • Neil Foster-McGregor

    ()
    (The Vienna Institute for International Economic Studies, wiiw)

  • Robert Stehrer

    ()
    (The Vienna Institute for International Economic Studies, wiiw)

Abstract

In this paper we examine the link between international outsourcing – or offshoring – and the skill structure of labour demand for a sample of 40 countries over the period 1995 2009. The paper uses data from the recently compiled World-Input-Output-Database (WIOD) to estimate a system of variable factor demand equations. These data allow us to exploit both a cross-country and cross-industry dimension and split employment into three skill categories. Our results indicate that while offshoring has impacted negatively upon all skill levels, the largest impacts have been observed for medium-skilled (and to a lesser extent high-skilled) workers. Such results are consistent with recent evidence indicating that medium-skilled workers have suffered to a greater extent than other skill types in recent years.

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Bibliographic Info

Paper provided by The Vienna Institute for International Economic Studies, wiiw in its series wiiw Working Papers with number 86.

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Length: 22 pages including 8 Tables and 4 Figures
Date of creation: Jun 2012
Date of revision:
Publication status: Published as wiiw Working Paper
Handle: RePEc:wii:wpaper:86

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Keywords: offshoring; trade; wages; labour demand;

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  1. David Autor & Frank Levy & Richard Murnane, 2003. "The skill content of recent technological change: an empirical exploration," Proceedings, Federal Reserve Bank of San Francisco, issue Nov.
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  7. Philip Du Caju & François Rycx & Ilan Tojerow, 2012. "Wage structure effects of international trade in a small open economy: The case of Belgium," ULB Institutional Repository 2013/138896, ULB -- Universite Libre de Bruxelles.
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Citations

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Cited by:
  1. Rexhaeuser, Sascha & Schulte, Patrick & Welsch, Heinz, 2013. "ICT and the demand for energy: Evidence from OECD countries," ZEW Discussion Papers 13-116, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  2. Georgescu, George, 2014. "International fragmentation of production. Local vulnerabilities and capitalization of heritage values in Romania," MPRA Paper 57255, University Library of Munich, Germany.
  3. João Amador & Sónia Cabral, 2014. "Global Value Chains: Surveying Drivers, Measures and Impacts," Working Papers w201403, Banco de Portugal, Economics and Research Department.
  4. Bart Hertveldt & Bernhard Michel, 2013. "Offshoring and the Skill Structure of Labour Demand in Belgium," De Economist, Springer, vol. 161(4), pages 399-420, December.
  5. Tomasz Chmielewski & John Eatwell & Neil Foster-McGregor & Andrzej Slawinski & Robert Stehrer, 2012. "Monthly Report No. 6/2012," wiiw Monthly Reports 2012-06, The Vienna Institute for International Economic Studies, wiiw.
  6. Warda, Peter, 2013. "Labor Decomposition: A Firm Level Analysis on Import Quality and Labor Demand," Working Paper Series in Economics and Institutions of Innovation 322, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.

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