EconPapers    
Economics at your fingertips  
 

The Pro-Trade Bias of Offshoring

Subhayu Bandyopadhyay, Arnab Basu, Nancy Chau and Devashish Mitra ()

No 313773, Working Papers from Cornell University, Department of Applied Economics and Management

Abstract: Technological advance and improvements in communication technologies have facilitated the offshoring of jobs worldwide, where a typical scene following the supply chain involves developing countries importing finished products from developed countries that contain developing country labor content. We demonstrate that this pattern of offshoring can harbor a pro-trade bias, but only among countries upstream along the global supply chain. This upstream-downstream asymmetry has important implications on countries’ (i) incentive to violate trade agreements, and (ii) ability to leverage the dispute settlement procedures to punish violators. We then show that a well-enforced set of labor standards in developing countries, such as a binding minimum wage, resolves this conundrum by reviving the ability of the developing countries to use countervailing tariffs to punish trade agreement violators.

Keywords: Labor; and; Human; Capital (search for similar items in EconPapers)
Pages: 29
Date: 2021-09-01
New Economics Papers: this item is included in nep-cwa, nep-ict, nep-int and nep-lma
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://ageconsearch.umn.edu/record/313773/files/W ... Pro-Trade%20Bias.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ags:cudawp:313773

DOI: 10.22004/ag.econ.313773

Access Statistics for this paper

More papers in Working Papers from Cornell University, Department of Applied Economics and Management Contact information at EDIRC.
Bibliographic data for series maintained by AgEcon Search ().

 
Page updated 2025-03-22
Handle: RePEc:ags:cudawp:313773