Skill-Biased Wage Effects of Domestic Outsourcing

Eren Gürer and Erol Taymaz

No 11758, CESifo Working Paper Series from CESifo

Abstract: This study examines the impact of domestic outsourcing on the wages of workers performing outsourced tasks in Türkiye, using an administrative employee-employer linked dataset. Outsourcing events are identified by tracking worker flows across firms with specific properties. Unlike existing studies, our dataset incorporates buyer-supplier transactions, enabling us to confirm that a relationship between the predecessor and successor firm begins following the outsourcing event. This improves our ability to identify outsourcing events, which we use to explore wage effects of both high-skilled and low-skilled outsourcing. Our findings indicate that low-skilled workers experience wage losses from domestic outsourcing, while high-skilled, professional workers benefit, suggesting that domestic outsourcing may be one of the factors contributing to rising wage inequality.

Keywords: domestic outsourcing; subcontracting; wage inequality (search for similar items in EconPapers)
JEL-codes: J31 J41 L24 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_11758

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