Outsourcing, Competitiveness and Employment. Effects mapped with a Sector Model of Austrian Manufacturing

Kurt Kratena and Michael Wüger
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Kurt Kratena: WIFO
Michael Wüger: WIFO
Authors registered in the RePEc Author Service: Michael Wueger

Austrian Economic Quarterly, 2001, vol. 6, issue 3, 120-132

Abstract: With the Austrian economy becoming more integrated into Eastern Central Europe, manufacturing steps are being shifted to Eastern Europe (outsourcing or "fragmentation"), following the intermediate step of lower costs payable for imported materials and services. Outsourcing impacts directly and negatively on domestic employment, yet simultaneously raises both output and employment indirectly as a consequence of lower costs at the macroeconomic level. This indirect effect is produced by cost savings, which in turn change output prices and thus improve competitiveness (on all markets).

Keywords: Outsourcing; Competitiveness and Employment. Effects mapped with a Sector Model of Austrian Manufacturing (search for similar items in EconPapers)
Date: 2001
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