IDEAS home Printed from https://ideas.repec.org/a/bla/reviec/v15y2007i1p188-205.html
   My bibliography  Save this article

International Outsourcing, Technological Change, and Wage Inequality

Author

Listed:
  • Alexander Hijzen

Abstract

This paper analyzes the impact of international outsourcing on UK wage inequality during the 1990s by applying the mandated wage approach proposed by Feenstra and Hanson (1999). The methodology is extended in order to obtain additional insight into the relative importance of the factor and sector bias of international outsourcing and technological change. The results indicate that technological change is the predominant force behind the increase in wage inequality, but international outsourcing also contributed significantly. In explaining the increase in wage inequality the factor bias of technological change was slightly larger than its sector bias, while for international outsourcing the sector bias was much more important. The relative importance of the two effects hinges crucially on the estimated rate of productivity passthrough.

Suggested Citation

  • Alexander Hijzen, 2007. "International Outsourcing, Technological Change, and Wage Inequality," Review of International Economics, Wiley Blackwell, vol. 15(1), pages 188-205, February.
    • Handle: RePEc:bla:reviec:v:15:y:2007:i:1:p:188-205
    DOI: 10.1111/j.1467-9396.2006.00623.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1467-9396.2006.00623.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1467-9396.2006.00623.x?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Robert C. Feenstra & Gordon H. Hanson, "undated". "Productivity Measurement And The Impact Of Trade And Technology On Wages: Estimates For The U.S., 1972-1990," Department of Economics 97-17, California Davis - Department of Economics.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Michel Dumont & Glenn Rayp & Olivier Thas & Peter Willemé, 2005. "Correcting Standard Errors in Two‐stage Estimation Procedures with Generated Regressands," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 67(3), pages 421-433, June.
    2. Sabine Engelmann, 2014. "International trade, technological change and wage inequality in the UK economy," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 41(2), pages 223-246, May.
    3. Ilham Haouas & Mahmoud Yagoubib, 2007. "The effect of international trade on labour-demand elasticities: empirical evidence from Tunisia," Applied Economics Letters, Taylor & Francis Journals, vol. 15(4), pages 277-286.
    4. Hoekman & Bernard & Winters, L. Alan, 2005. "Trade and employment : stylized facts and research findings," Policy Research Working Paper Series 3676, The World Bank.
    5. Guillaume Daudin & Christine Rifflart & Danielle Schweisguth, 2011. "Who produces for whom in the world economy?," Canadian Journal of Economics, Canadian Economics Association, vol. 44(4), pages 1403-1437, November.
    6. Ioannis Bournakis & Michela Vecchi & Francesco Venturini, 2018. "Off‐Shoring, Specialization and R&D," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 64(1), pages 26-51, March.
    7. Nicita, Alessandro, 2004. "Who benefited from trade liberalization in Mexico? Measuring the effects on household welfare," Policy Research Working Paper Series 3265, The World Bank.
    8. Picciolo, Francesco & Papandreou, Andreas & Hubacek, Klaus & Ruzzenenti, Franco, 2017. "How crude oil prices shape the global division of labor," Applied Energy, Elsevier, vol. 189(C), pages 753-761.
    9. Ángel Paúl Moreno Plascencia & Rafael Salvador Espinosa Ramírez, 2018. "Effects of the Foreign Direct Investment on the Productivity of Latin American Countries (1990-2012)," Economía: teoría y práctica, Universidad Autónoma Metropolitana, México, vol. 49(2), pages 7-36, Julio-Dic.
    10. Robert C. Feenstra, 1998. "Integration of Trade and Disintegration of Production in the Global Economy," Journal of Economic Perspectives, American Economic Association, vol. 12(4), pages 31-50, Fall.
    11. Bosello, Francesco & Roson, Roberto & Tol, Richard S.J., 2006. "Economy-wide estimates of the implications of climate change: Human health," Ecological Economics, Elsevier, vol. 58(3), pages 579-591, June.
    12. De Santis, Roberto A., 1999. "Intra-industry trade, endogenous technological change, wage inequality and welfare," Kiel Working Papers 921, Kiel Institute for the World Economy (IfW Kiel).
    13. repec:eee:labchp:v:3:y:1999:i:pb:p:2215-2288 is not listed on IDEAS
    14. Johannes Fedderke & Yongcheol Shin & Prabhat Vaze, 2003. "Trade, Technology and Wage Inequality in the South African Manufacturing Sectors," Edinburgh School of Economics Discussion Paper Series 106, Edinburgh School of Economics, University of Edinburgh.
    15. Ms. Faezeh Raei & Anna Ignatenko & Borislava Mircheva, 2019. "Global Value Chains: What are the Benefits and Why Do Countries Participate?," IMF Working Papers 2019/018, International Monetary Fund.
    16. Wei Zou & Lan Liu & Ziyin Zhuang, 2009. "Skill Premium, Biased Technological Change and Income Differences," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 17(6), pages 64-87, November.
    17. Shandre M. Thangvelu, . "Trade, Technology, Foreign Firms and Wage Gap: Case of Vietnam Manufacturing Firms," Chapters, in: Chine Hee HAHN & Dionisius Narjoko (ed.), Impact of Globalization on Labor Market, chapter 5, pages 106-133, Economic Research Institute for ASEAN and East Asia (ERIA).
    18. Aekapol Chongvilaivan, 2012. "Learning by exporting and high-tech capital deepening in Singapore manufacturing industries, 1974–2006," Applied Economics, Taylor & Francis Journals, vol. 44(20), pages 2551-2568, July.
    19. World Bank, 2004. "Inequality and Economic Development in Brazil," World Bank Publications - Books, The World Bank Group, number 14913.
    20. Yuntong Wang & Xiaopeng Yin, 2016. "Technology Transfer, Welfare, and Wage Inequality," Review of Development Economics, Wiley Blackwell, vol. 20(2), pages 611-623, May.
    21. Aekapol Chongvilaivan, 2012. "Learning by exporting and high-tech capital deepening in Singapore manufacturing industries, 1974--2006," Applied Economics, Taylor & Francis Journals, vol. 44(20), pages 2551-2568, July.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:reviec:v:15:y:2007:i:1:p:188-205. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://www.blackwellpublishing.com/journal.asp?ref=0965-7576 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.