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International Services Outsourcing and Innovation: An Empirical Investigation

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  • Holger Görg
  • Aoife Hanley

Abstract

We provide a comprehensive empirical analysis of the links between international services outsourcing, wages and innovation using plant level data covering the period 2000 to 2004. Somewhat consistent with the predictions of recent theory, we observe a positive relationship between international outsourcing of services and innovative activity, measured in terms of R&D, at the plant level. However, we only find evidence for such positive effects for plants in manufacturing, not in services sectors. Furthermore, this positive effect of international services outsourcing on innovation does not appear to be mediated through wages as proposed by theory.

Suggested Citation

  • Holger Görg & Aoife Hanley, 2007. "International Services Outsourcing and Innovation: An Empirical Investigation," Discussion Papers 07/43, University of Nottingham, GEP.
    • Handle: RePEc:not:notgep:07/43
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    References listed on IDEAS

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    1. Holger Görg & Aoife Hanley & Eric Strobl, 2008. "Productivity effects of international outsourcing: evidence from plant‐level data," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 41(2), pages 670-688, May.
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    10. Criscuolo, Chiara & Haskel, Jonathan E. & Slaughter, Matthew J., 2010. "Global engagement and the innovation activities of firms," International Journal of Industrial Organization, Elsevier, vol. 28(2), pages 191-202, March.
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    Cited by:

    1. Addison, John T. & Bellmann, Lutz & Pahnke, André & Teixeira, Paulino, 2011. "A research note on the determinants and consequences of outsourcing using German data," Zeitschrift für ArbeitsmarktForschung - Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 44(3), pages 231-244.
    2. Addison, John T. & Bellmann, Lutz & Pahnke, André & Teixeira, Paulino, 2011. "A research note on the determinants and consequences of outsourcing using German data," Zeitschrift für ArbeitsmarktForschung - Journal for Labour Market Research, Institut für Arbeitsmarkt- und Berufsforschung (IAB), Nürnberg [Institute for Employment Research, Nuremberg, Germany], vol. 44(3), pages 231-244.

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