IDEAS home Printed from https://ideas.repec.org/a/bla/scandj/v112y2010i2p339-360.html
   My bibliography  Save this article

Whose Job Goes Abroad? International Outsourcing and Individual Job Separations

Author

Listed:
  • Jakob R. Munch

Abstract

This paper focuses on the adjustment costs of globalisation by studying the effects of international outsourcing on individual transitions out of jobs in the Danish manufacturing sector for the period 1990–2003. A competing risks duration model that distinguishes between job‐to‐job and job‐to‐unemployment transitions is estimated. Outsourcing is found to increase the unemployment risk of low‐skilled workers, but the quantitative impact is modest. Outsourcing is also found to reduce the job change hazard rate for all education groups. Thus, the paper provides evidence for small adjustment costs of globalisation.

Suggested Citation

  • Jakob R. Munch, 2010. "Whose Job Goes Abroad? International Outsourcing and Individual Job Separations," Scandinavian Journal of Economics, Wiley Blackwell, vol. 112(2), pages 339-360, June.
    • Handle: RePEc:bla:scandj:v:112:y:2010:i:2:p:339-360
    DOI: 10.1111/j.1467-9442.2010.01607.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1467-9442.2010.01607.x
    Download Restriction: no
    File URL: https://libkey.io/10.1111/j.1467-9442.2010.01607.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. Heckman, James & Singer, Burton, 1984. "A Method for Minimizing the Impact of Distributional Assumptions in Econometric Models for Duration Data," Econometrica, Econometric Society, vol. 52(2), pages 271-320, March.
    2. Madeline Zavodny, 2003. "Technology and Job Separation Among Young Adults, 1980--98," Economic Inquiry, Western Economic Association International, vol. 41(2), pages 264-278, April.
    3. Giuseppe Nicoletti & Stefano Scarpetta & Olivier Boylaud, 2000. "Summary Indicators of Product Market Regulation with an Extension to Employment Protection Legislation," OECD Economics Department Working Papers 226, OECD Publishing.
    4. Wilhelm Kohler, 2004. "International outsourcing and factor prices with multistage production," Economic Journal, Royal Economic Society, vol. 114(494), pages 166-185, March.
    5. Robert C. Feenstra & Gordon H. Hanson, 1999. "The Impact of Outsourcing and High-Technology Capital on Wages: Estimates For the United States, 1979–1990," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 114(3), pages 907-940.
    6. Ingo Geishecker & Holger Görg, 2008. "Winners and losers: a micro‐level analysis of international outsourcing and wages," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 41(1), pages 243-270, February.
    7. Geishecker, Ingo & Gorg, Holger, 2005. "Do unskilled workers always lose from fragmentation?," The North American Journal of Economics and Finance, Elsevier, vol. 16(1), pages 81-92, March.
    8. Martin Browning & Anne Moller Dano & Eskil Heinesen, 2006. "Job displacement and stress‐related health outcomes," Health Economics, John Wiley & Sons, Ltd., vol. 15(10), pages 1061-1075, October.
    9. Sueyoshi, Glenn T., 1992. "Semiparametric proportional hazards estimation of competing risks models with time-varying covariates," Journal of Econometrics, Elsevier, vol. 51(1-2), pages 25-58.
    10. Jakob Munch & Jan Skaksen, 2009. "Specialization, outsourcing and wages," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 145(1), pages 57-73, April.
    11. Henry S. Farber, 2005. "What do we know about job loss in the United States? evidence from the displaced workers survey, 1984-2004," Economic Perspectives, Federal Reserve Bank of Chicago, vol. 29(Q II), pages 13-28.
    12. Gene M. Grossman & Esteban Rossi-Hansberg, 2008. "Trading Tasks: A Simple Theory of Offshoring," American Economic Review, American Economic Association, vol. 98(5), pages 1978-1997, December.
    13. Arndt, Sven W., 1997. "Globalization and the open economy," The North American Journal of Economics and Finance, Elsevier, vol. 8(1), pages 71-79.
    14. Alexander Hijzen & Holger Görg & Robert C. Hine, 2005. "International Outsourcing and the Skill Structure of Labour Demand in the United Kingdom," Economic Journal, Royal Economic Society, vol. 115(506), pages 860-878, October.
    15. Henry S. Farber, 2005. "What do we know about Job Loss in the United States? Evidence from the Displaced Workers Survey, 1984-2004," Working Papers 877, Princeton University, Department of Economics, Industrial Relations Section..
    16. Henry S. Farber, 2005. "What do we know about Job Loss in the United States? Evidence from the Displaced Workers Survey, 1984-2004," Working Papers 877, Princeton University, Department of Economics, Industrial Relations Section..
    17. Hummels, David & Ishii, Jun & Yi, Kei-Mu, 2001. "The nature and growth of vertical specialization in world trade," Journal of International Economics, Elsevier, vol. 54(1), pages 75-96, June.
    18. Patricia M. Anderson & Bruce D. Meyer, 1994. "The Extent and Consequences of Job Turnover," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 25(1994 Micr), pages 177-248.
    19. Royalty, Anne Beeson, 1998. "Job-to-Job and Job-to-Nonemployment Turnover by Gender and Education Level," Journal of Labor Economics, University of Chicago Press, vol. 16(2), pages 392-443, April.
    20. Michael Pfaffermayr & Peter Egger & Andrea Weber, 2007. "Sectoral adjustment of employment to shifts in outsourcing and trade: evidence from a dynamic fixed effects multinomial logit model," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 22(3), pages 559-580.
    21. Kohler, Wilhelm, 2001. "A specific-factors view on outsourcing," The North American Journal of Economics and Finance, Elsevier, vol. 12(1), pages 31-53, March.
    22. Venables, Anthony J., 1999. "Fragmentation and multinational production," European Economic Review, Elsevier, vol. 43(4-6), pages 935-945, April.
    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. Geishecker, Ingo, 2008. "The impact of international outsourcing on individual employment security: A micro-level analysis," Labour Economics, Elsevier, vol. 15(3), pages 291-314, June.
    2. Rosario Crinò, 2009. "Offshoring, Multinationals And Labour Market: A Review Of The Empirical Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 23(2), pages 197-249, April.
    3. Geishecker, Ingo & Görg, Holger & Munch, Jakob R., 2007. "Do Labour Market Institutions Matter? Micro-Level Wage Effects of International Outsourcing in Three European Countries," IZA Discussion Papers 3212, Institute of Labor Economics (IZA).
    4. Castellani, Davide & De Benedictis, Luca & Horgos, Daniel, 2013. "Can we really trust offshoring indices?," Structural Change and Economic Dynamics, Elsevier, vol. 25(C), pages 159-172.
    5. João Amador & Sónia Cabral, 2014. "Global Value Chains: Surveying Drivers, Measures and Impacts," Working Papers w201403, Banco de Portugal, Economics and Research Department.
    6. Aleksandra Parteka & Joanna Wolszczak-Derlacz, 2019. "Global Value Chains and Wages: Multi-Country Evidence from Linked Worker-Industry Data," Open Economies Review, Springer, vol. 30(3), pages 505-539, July.
    7. Urban, Dieter M & Weder di Mauro, Beatrice & Moser, Christoph, 2009. "Offshoring, Firm Performance and Establishment-Level Employment: Identifying Productivity and Downsizing Effects," CEPR Discussion Papers 7455, C.E.P.R. Discussion Papers.
    8. Malchow-Møller, Nikolaj & Munch, Jakob R. & Skaksen, Jan Rose, 2009. "Do Immigrants Take the Jobs of Native Workers?," IZA Discussion Papers 4111, Institute of Labor Economics (IZA).
    9. Ronald Bachmann & Sebastian Braun, 2011. "The Impact Of International Outsourcing On Labour Market Dynamics In Germany," Scottish Journal of Political Economy, Scottish Economic Society, vol. 58(1), pages 1-28, February.
    10. Ingo Geishecker & Holger Görg & Jakob Roland Munch, 2010. "Do labour market institutions matter? Micro-level wage effects of international outsourcing in three European countries," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 146(1), pages 179-198, April.
    11. Alessia Lo Turco & Aleksandra Parteka, 2011. "The demand for skills and labour costs in partner countries," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 19(3), pages 611-637, July.
    12. Sebastian Benz, 2012. "Trading Tasks: A Dynamic Theory of Offshoring," ifo Working Paper Series 150, ifo Institute - Leibniz Institute for Economic Research at the University of Munich.
    13. Schwörer, Tillmann, 2012. "Offshoring, domestic outsourcing, and productivity: Evidence for a number of European countries," Kiel Working Papers 1786, Kiel Institute for the World Economy (IfW Kiel).
    14. Saygılı, Hülya, 2017. "Production fragmentation and factor price convergence," International Review of Economics & Finance, Elsevier, vol. 51(C), pages 535-544.
    15. Aronsson, Thomas & Koskela, Erkki, 2008. "Optimal Redistributive Taxation and Provision of Public Input Goods in an Economy with Outsourcing and Unemployment," Umeå Economic Studies 759, Umeå University, Department of Economics.
    16. Neil Foster-McGregor & Robert Stehrer & Gaaitzen Vries, 2013. "Offshoring and the skill structure of labour demand," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 149(4), pages 631-662, December.
    17. David Hummels & Jakob R. Munch & Chong Xiang, 2018. "Offshoring and Labor Markets," Journal of Economic Literature, American Economic Association, vol. 56(3), pages 981-1028, September.
    18. Ronald Bachmann & Sebastian Braun, 2008. "The Impact of International Outsourcing on Labour Market Dynamics in Germany," Ruhr Economic Papers 0053, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
    19. Jan Hogrefe & Jens Wrona, 2015. "Trade, tasks and training: The effect of offshoring on individual skill upgrading," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 48(4), pages 1537-1560, November.
    20. Matilde Cardoso & Pedro Cunha Neves & Oscar Afonso & Elena Sochirca, 2021. "The effects of offshoring on wages: a meta-analysis," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 157(1), pages 149-179, February.

    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:scandj:v:112:y:2010:i:2:p:339-360. 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://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1467-9442 .

    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.