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Interlocking Margins: The Interaction of Offshoring and Outsourcing Decisions

Edwin Jiang

No 2021-02, Working Papers from University of Sydney, School of Economics

Abstract: I develop a multi-country general equilibrium model on global sourcing which considers individual firm's decisions on outsourcing as well as offshoring. These decisions are closely connected as more extensive offshoring provides incentives for further integration of inputs. The firm-level decisions aggregate to produce gravity style equations of trade flows between countries, and intra-firm transactions.

Date: 2021-02
New Economics Papers: this item is included in nep-bec and nep-int
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