Offshoring: What Consequences for Workers? Evidence from Global Value Chains

Katharina Längle
Additional contact information
Katharina Längle: CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement

Post-Print from HAL

Abstract: This paper investigates the question which aspects of offshoring harm low skilled workers using data from the WIOD for 14 manufacturing industries in 16 countries between 1995 and 2008. By considering the use of foreign production factors in domestic production, the paper shows that low skilled workers are directly and negatively affected by offshoring of low skilled tasks. Importantly, the paper determines a further indirect channel highlighting the role of growing foreign competition in domestic markets for intermediate goods. Accordingly, wage shares of low skilled workers decline when competition in domestic downstream value chains increases. Interpreting this channel in the light of the literature on defensive skill-biased innovation, the shift in wage shares away from low skilled workers might be provoked by skill intensive investments in response to tougher foreign competition in domestic markets for intermediate goods.

Keywords: Global value chains; Input-Output Tables and Analysis; Organization of Production; Empirical Studies of Trade (search for similar items in EconPapers)
Date: 2020-04
New Economics Papers: this item is included in nep-int and nep-tid
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-02899944v1
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in 2020

Downloads: (external link)
https://shs.hal.science/halshs-02899944v1/document (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:hal:journl:halshs-02899944

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().