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Measuring and Understanding Trade in Service Tasks

Author

Listed:
  • Daniel Chiquiar

    (Banco de México)

  • Martín Tobal

    (Banco de México)

  • Renato Yslas

    (Banco de México)

Abstract

Improvements in Information and Communication Technologies (ICT) have had differential impacts on the costs of offshoring service tasks. As a result, services with stronger tradability characteristics are at a higher risk of being offshored. This has increased the need for coming up with proper measures of service tradability and to better understand the labor market implications of service offshoring. This paper reviews a literature that has proposed measures of service tradability, investigated the causal effects of service offshoring and developed theoretical models to rationalize the associated stylized facts. The review suggests that skill-intensity and tradability are key determinants of wage and employment effects. Nonetheless, the lack of widely accepted definitions and measures of tradability, the absence of high quality data on service trade flows and the difficulty of measuring import competition at higher disaggregation levels pose difficulties to attain further empirical progress. The theoretical literature must produce a new generation of models that could rationalize the stylized facts.

Suggested Citation

  • Daniel Chiquiar & Martín Tobal & Renato Yslas, 2016. "Measuring and Understanding Trade in Service Tasks," Discussion Notes 1602, Council on Economic Policies.
  • Handle: RePEc:ceq:discno:1602
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    References listed on IDEAS

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    Cited by:

    1. Maria Savona, 2021. "Revisiting High Development Theory to Explain Upgrading Prospects in Business Services Global Value Chains," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 33(2), pages 206-226, April.
    2. Martin Tobal, 2019. "A model of wage and employment effects of service offshoring," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 52(1), pages 303-338, February.

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    JEL classification:

    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions

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