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Assessing the impact of domestic outsourcing and offshoring on productivity at the firm level

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  • Jos頃. Fari
  • Alberto L󰥺
  • Ana Mart󻑍arcos

Abstract

The purpose of this article is to investigate the effects of domestic and foreign sourcing on firm-level productivity. We develop a simple framework that permits the introduction of both domestic outsourcing and offshoring in a conventional production function. We find that the decision to outsource has a positive impact on the level of productivity as it permits the relocation of parts of the production process to external suppliers. Furthermore, there is a positive impact on output resulting from domestic outsourcing and offshoring like any other input.

Suggested Citation

  • Jos頃. Fari & Alberto L󰥺 & Ana Mart󻑍arcos, 2014. "Assessing the impact of domestic outsourcing and offshoring on productivity at the firm level," Applied Economics, Taylor & Francis Journals, vol. 46(15), pages 1814-1828, May.
    • Handle: RePEc:taf:applec:v:46:y:2014:i:15:p:1814-1828
    DOI: 10.1080/00036846.2014.884704
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    3. Caroline Stiel, 2017. "Modern Public Enterprises: Organisational Innovation and Productivity," Discussion Papers of DIW Berlin 1713, DIW Berlin, German Institute for Economic Research.
    4. Kovach, Jeremy J. & Swink, Morgan & Rodriguez, Mauricio, 2023. "A novel measure of firm-level production outsourcing," International Journal of Production Economics, Elsevier, vol. 263(C).

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