Assessing the impact of domestic outsourcing and offshoring on productivity at the firm level
Alberto L and
Authors registered in the RePEc Author Service: Jose C. Fariñas () and
Alberto López Sebastián ()
Applied Economics, 2014, vol. 46, issue 15, 1814-1828
The purpose of this article is to investigate the effects of domestic and foreign sourcing on firm-level productivity. We develop a simple framework that permits the introduction of both domestic outsourcing and offshoring in a conventional production function. We find that the decision to outsource has a positive impact on the level of productivity as it permits the relocation of parts of the production process to external suppliers. Furthermore, there is a positive impact on output resulting from domestic outsourcing and offshoring like any other input.
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