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Statistics to Measure Offshoring and its Impact

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  • Robert C. Feenstra

Abstract

We identify “first generation” statistics to measure offshoring as the share of imported intermediate inputs in costs, along with O*NET data to measure the tradability of tasks. These data were used to measure the shifts in relative labor demand and relative wages due to offshoring. A limitation of these statistics is that they cannot be used to measure the impact on real wages, and for that purpose, we need price-based measures of offshoring. More recently, “second generation” statistics have arisen from global input-output tables. These measures include the foreign value-added in exports, or its counterpart, the domestic value-added in exports. We illustrate the foreign value-added component in the surge of Chinese exports following its WTO entry in 2001. We argue that such second-generation statistics should also be supplemented by price-based measure of offshoring, and we propose one simple measure that extends the effective rate of protection on imports to apply to exported goods.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 23067.

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Date of creation: Jan 2017
Handle: RePEc:nbr:nberwo:23067
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  • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation

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