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Offshoring and Job Stability: Evidence from Italian Manufacturing

  • Alessia LO TURCO


    (Universita Politecnica delle Marche, Department of Economics and Social Sciences, Ancona, Italy)

  • Daniela MAGGIONI


    (Universita Politecnica delle Marche, Department of Economics and Social Sciences, Ancona, Italy)

  • Matteo PICCHIO


    (Research Foundation - Flanders (FWO); Sherppa, Ghent University; Department of Economics, CentER,Tilburg University; IZA, Bonn)

We study the relationship between offshoring and job stability in Italy in the period 1995–2001 by using an administrative dataset on manufacturing workers. We find that the international fragmentation of production negatively affects job stability. Service offshoring and material purchases from developed countries foster job-to-job transitions within manufacturing of all workers and white collars, respectively. However, the most detrimental effects for job stability come from material offshoring to low income countries which drives blue collar workers out of manufacturing. Therefore, policy interventions should especially focus on this latter category of workers more exposed to fragmentation processes and foreign competition.

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Paper provided by Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES) in its series Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) with number 2012007.

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Length: 33
Date of creation: 19 Apr 2012
Date of revision:
Handle: RePEc:ctl:louvir:2012007
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