Firms' Use of Outside Contractors: Theory and Evidence

Katharine Abraham () and Susan K. Taylor

No 4468, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: A firm's decision to contract out for business support services may be influenced by the wage and benefit savings it could realize, the volatility of its output demand and the availability of specialized skills possessed by the outside contractor. Analysis of newly-available establishment-level data shows that all three of these factors help to explain observed contracting behavior. The reported empirical findings are relevant both for understanding the recent growth in business support service contracting and for understanding firms' relationships with their own employees.

JEL-codes: J41 L14 (search for similar items in EconPapers)
Date: 1993-09
Note: LS
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Published as JLE, Vol. 14, no. 3 (July 1996): 394-424.

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Journal Article: Firms' Use of Outside Contractors: Theory and Evidence (1996)
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