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Contracting out and labor demand elasticities

Author

Listed:
  • GORG, Holger
  • PICARD, Pierre
  • STROBL, Eric

Abstract

We examine the relationship between contracting out and the wage elasticity of labor demand in outsourcing plants. A simple theoretical model suggests that firms engaged in contracting out have lower wage elasticities. Estimating plant level dynamic labor demand equations for Irish manufacturing we find evidence supportive of this.

Suggested Citation

  • GORG, Holger & PICARD, Pierre & STROBL, Eric, 2005. "Contracting out and labor demand elasticities," LIDAM Discussion Papers CORE 2005082, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvco:2005082
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    File URL: https://sites.uclouvain.be/core/publications/coredp/coredp2005.html
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