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International Outsourcing and German Manufacturing Wages

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  • Ingo Geishecker

Abstract

This paper investigates the link between international outsourcing and wages utilising the German Socio-Economic Panel (SOEP) and combining it with industry-level information on industries' outsourcing activities. Instead of following the literature by differentiating between manual and non-manual workers, I also utilise data on educational attainment in order to distinguish between skill categories. While outsourcing proves to be statistically insignificant for manual and non-manual workers' wages, I find evidence that when applying a more accurate skill definition, a one percentage point increase in our outsourcing measure reduces the real wage for low-skilled workers by 1.7 percent while it increases real wages for high-skilled workers by 2.2 percent.

Suggested Citation

  • Ingo Geishecker, 2005. "International Outsourcing and German Manufacturing Wages," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 125(1), pages 87-95.
    • Handle: RePEc:aeq:aeqsjb:v125_y2005_i1_q1_p87-95
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    More about this item

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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