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Globalization, Offshoring and Economic Insecurity in Industrialized Countries

Author

Listed:
  • William Milberg
  • Deborah Winkler

Abstract

This paper shows that a “new wave of globalization,” involving extensive offshoring, has raised both actual and perceived labor market insecurity in industrialized countries. The paper analyzes various channels through which this new wave of globalization leads to economic insecurity. It emphasises the key role of overall macroeconomic conditions in determining the outcome of offshoring. The paper points out the inadequacies of various policy responses that industrialized countries have come up with so far and advocates urgent steps toward formulation of policies and erection of institutional structure more appropriate to confront the challenges of the new of globalization.

Suggested Citation

  • William Milberg & Deborah Winkler, 2009. "Globalization, Offshoring and Economic Insecurity in Industrialized Countries," Working Papers 87, United Nations, Department of Economics and Social Affairs.
  • Handle: RePEc:une:wpaper:87
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    File URL: http://www.un.org/esa/desa/papers/2009/wp87_2009.pdf
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    References listed on IDEAS

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    4. Ann Harrison & Margaret McMillan, 2011. "Offshoring Jobs? Multinationals and U.S. Manufacturing Employment," The Review of Economics and Statistics, MIT Press, vol. 93(3), pages 857-875, August.
    5. Catherine L. Mann, 2003. "Globalization of IT Services and White Collar Jobs: The Next Wave of Productivity Growth," Policy Briefs PB03-11, Peterson Institute for International Economics.
    6. Engelbert Stockhammer, 2004. "Financialisation and the slowdown of accumulation," Cambridge Journal of Economics, Oxford University Press, vol. 28(5), pages 719-741, September.
    7. Robert Feenstra & Gordon Hanson, 2001. "Global Production Sharing and Rising Inequality: A Survey of Trade and Wages," NBER Working Papers 8372, National Bureau of Economic Research, Inc.
    8. Ekholm, Karolina & Hakkala, Katariina, 2005. "The Effect of Offshoring on Labor Demand: Evidence from Sweden," Working Paper Series 654, Research Institute of Industrial Economics.
    9. Jeffrey D. Sachs & Howard J. Shatz, 1994. "Trade and Jobs in Manufacturing," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 25(1), pages 1-84.
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    11. Minsik Choi, 2001. "Threat Effect of Foreign Direct Investment on Labor Union Wage Premium," Working Papers wp27, Political Economy Research Institute, University of Massachusetts at Amherst.
    12. Wood, Adrian, 1995. "North-South Trade, Employment and Inequality: Changing Fortunes in a Skill-Driven World," OUP Catalogue, Oxford University Press, number 9780198290155.
    13. Marianna Belloc, 2004. "Do Labor Market Institutions Affect International Comparative Advantage? An Empirical Investigation," Department of Economics University of Siena 444, Department of Economics, University of Siena.
    14. Richard G. Anderson & Charles S. Gascon, 2007. "The perils of globalization: offshoring and economic insecurity of the American worker," Working Papers 2007-004, Federal Reserve Bank of St. Louis.
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    Citations

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    Cited by:

    1. Denisa Maria Sologon & Cathal O'Donoghue, 2014. "Shaping Earnings Insecurity: Labor Market Policy and Institutional Factors," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 60(S1), pages 205-232, May.
    2. Denisa Maria Sologon & O'Donoghue, Cathal, 2011. "Shaping earnings instability: labour market policy and institutional factors," MERIT Working Papers 077, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    3. Marika Karanassou & Hector Sala, 2012. "Inequality and Employment Sensitivities to the Falling Labour Share," The Economic and Social Review, Economic and Social Studies, vol. 43(3), pages 343-376.
    4. Paola Anitori, 2016. "Effetti dell’offshoring sull’occupazione manifatturiera italiana negli anni 2000-2011," ECONOMIA E SOCIETÀ REGIONALE, FrancoAngeli Editore, vol. 2016(3), pages 144-180.

    More about this item

    Keywords

    offshoring; contracting out internationally; economic insecurity; profit share; financialization; globalized production; social security benefits;

    JEL classification:

    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • F2 - International Economics - - International Factor Movements and International Business
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures

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