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Foreign Outsourcing, Exporting, and FDI: A Productivity Comparison at the Firm Level

Author

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  • Eiichi Tomiura

    (Research Institute for Economics & Business Administration (RIEB), Kobe University, Japan)

Abstract

This paper compares the productivity of firms active in foreign outsourcing, exporting, foreign direct investment, or only in domestic operations by a firm-level data of more than 118 thousand Japanese manufacturers. Only a small fraction of firms outsource, export, or invest across borders. The group averages, inter-firm distributions, regressions controlling for industry-effects, and multinomial response models unanimously demonstrate that FDI firms are distinctively more productive than foreign outsourcing firms, which are equally productive as exporters and are clearly more productive than domestic firms. Productive, innovative, or computerized firms are likely to globalize. The firms outsourcing overseas are particularly labor-intensive.

Suggested Citation

  • Eiichi Tomiura, 2005. "Foreign Outsourcing, Exporting, and FDI: A Productivity Comparison at the Firm Level," Discussion Paper Series 168, Research Institute for Economics & Business Administration, Kobe University.
  • Handle: RePEc:kob:dpaper:168
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Productivity; Firm-level data; Exporter; Foreign outsourcing; FDI;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • D20 - Microeconomics - - Production and Organizations - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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