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Offshoring and Occupational Wages: Some empirical evidence

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  • Bigsten, Arne

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

  • Durevall, Dick

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

  • Munshi, Farzana

    (Department of Economics, School of Business, Economics and Law, Göteborg University)

Abstract

Offshoring has changed the pattern of international competition; labor in specific occupations rather than whole firms and sectors are now facing competition. Accordingly, wages in offshorable occupations are affected in new ways. In this paper we investigate the effects of offshoring of electronically traded services on relative occupational wages in 13 countries in the 1990-2003 period. Our findings show that increased exports of IT-related services lead to higher relative wages in offshorable occupations, whereas increased imports of such service reduce them. There is also some evidence that the impact of offshoring on relative wages is larger the lower the level GDP per capita.

Suggested Citation

  • Bigsten, Arne & Durevall, Dick & Munshi, Farzana, 2008. "Offshoring and Occupational Wages: Some empirical evidence," Working Papers in Economics 312, University of Gothenburg, Department of Economics.
  • Handle: RePEc:hhs:gunwpe:0312
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    File URL: http://hdl.handle.net/2077/10640
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    Cited by:

    1. 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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    More about this item

    Keywords

    Offshoring; globalization; occupational wages; service trade;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration
    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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