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Offshoring and Business Organization: Evidence from Canadian Manufacturing Firms

Lydia Couture, Jianmin Tang and Beiling Yan ()
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Lydia Couture: Statistics Canada

Transnational Corporations Review, 2015, vol. 7, issue 2, 148-168

Abstract: In the globalized economy, it has become essential for firms to re-organize their production to grow and to be competitive in both domestic and international markets. Over the past decade, offshoring has emerged as an important and valuable business re-organization avenue, especially in the manufacturing sector. Using newly linked Canadian manufacturing micro data for 2002-2006, which for the first time provides a direct measure of offshoring over a period in Canada at the firm level, this paper examines and estimates the linkage between offshoring and business organization. It shows that offshoring is part of firms¡¦ overall business strategy, closely linked to other outward-oriented business activities such as exporting and being foreign-controlled. In addition, it is found that offshoring is associated with business organization in terms of firm variation in intermediate input variety and in output concentration.

Keywords: Offshoring; business organization; intermediate input variety; output concentration (search for similar items in EconPapers)
JEL-codes: F14 L20 (search for similar items in EconPapers)
Date: 2015
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Handle: RePEc:oul:tncr09:v:7:y:2015:i:2:p:148-168