Specialization, outsourcing and wages

Jakob Roland Munch; Jan Rose Skaksen

doi:10.1007/s10290-009-0009-2

Specialization, outsourcing and wages

Jakob Roland Munch, Jan Rose Skaksen

Økonomisk Institut

24 Citationer (Scopus)

Abstract

This paper studies the impact of outsourcing on individual wages. In contrast to the standard approach in the literature, we focus on domestic outsourcing as well as foreign outsourcing. We argue that if outsourcing is associated with specialization gains arising from an increase in the division of labor, domestic outsourcing tends to increase wages for both unskilled and skilled labor. We use a panel data set of workers in Danish manufacturing industries to show that domestic and foreign outsourcing affect wages as predicted.

Originalsprog	Engelsk
Tidsskrift	Review of World Economics
Vol/bind	145
Udgave nummer	1
Sider (fra-til)	57-73
Antal sider	17
ISSN	1610-2878
DOI	https://doi.org/10.1007/s10290-009-0009-2
Status	Udgivet - 2009

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10.1007/s10290-009-0009-2

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AB - This paper studies the impact of outsourcing on individual wages. In contrast to the standard approach in the literature, we focus on domestic outsourcing as well as foreign outsourcing. We argue that if outsourcing is associated with specialization gains arising from an increase in the division of labor, domestic outsourcing tends to increase wages for both unskilled and skilled labor. We use a panel data set of workers in Danish manufacturing industries to show that domestic and foreign outsourcing affect wages as predicted.

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Specialization, outsourcing and wages

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