Outsourcing, Unemployment and Welfare Policy

Christian Keuschnigg and Evelyn Ribi

No 6605, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: Outsourcing of labour intensive activities challenges the welfare state and undermines the protection of low-skilled workers. The stylized facts are that profits are concentrated among the high-skilled, involuntary unemployment is mostly among the low-skilled, and private unemployment insurance is missing. This paper analyzes the effectiveness of redistribution and social insurance and characterizes the optimal welfare policy when heterogeneous firms can outsource labour intensive components to low-wage economies.

Keywords: Outsourcing; Redistribution; Social insurance; Unemployment (search for similar items in EconPapers)
JEL-codes: F23 H21 J64 J65 L23 (search for similar items in EconPapers)
Date: 2007-12
New Economics Papers: this item is included in nep-ias and nep-lab
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Citations: View citations in EconPapers (5)

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Related works:
Journal Article: Outsourcing, unemployment and welfare policy (2009)
Working Paper: Outsourcing, Unemployment and Welfare Policy (2008)
Working Paper: Outsourcing, Unemployment and Welfare Policy (2007)
Working Paper: Outsourcing, Unemployment and Welfare Policy (2007)
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