Outsourcing and Trade in a Spatial World

Hartmut Egger () and Peter Egger

No 1349, CESifo Working Paper Series from CESifo

Abstract: This paper provides an analysis of outsourcing and trade in a spatial model à la Hotelling. In this setting, we discuss the trade-off between transport-cost-related disadvantages and outsourcing-induced production cost advantages of a large economy. The model gives a rich picture of possible trade and welfare effects of a movement towards free trade and points to the role of national transport costs for explaining these effects. Moreover, it gives economic insights in the countries’ incentives to lower tariffs and to participate in free trade agreements with partner countries that differ in size and economic capacity.

Keywords: international outsourcing; international trade; spatial competition (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Outsourcing and trade in a spatial world (2007)
Working Paper: Outsourcing and Trade in a Spatial World (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_1349

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