Winners and Losers: Fragmentation, Trade and Wages Revisited

Ingo Geishecker and Holger Görg

No 385, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: Our paper investigates the link between international outsourcing and wages utilising a large household panel and combining it with industry level information on industries' outsourcing activities from input-output tables. By doing so we can arguably overcome the potential aggregation bias as well as other shortcomings that affect industry level studies. We find that outsourcing has had a marked impact on wages. Distinguishing three skill categories we find evidence that outsourcing reduced the real wage for workers in the lowest skill categories by up to 1.8% while it increased real wages for high-skilled workers by up to 3.3%. This result is robust to a number of different specifications.

Keywords: Outsourcing; Fragmentation; Skills; Wages (search for similar items in EconPapers)
JEL-codes: F16 J31 L24 (search for similar items in EconPapers)
Pages: 27 p.
Date: 2003
New Economics Papers: this item is included in nep-lab
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Citations: View citations in EconPapers (1)

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Working Paper: Winners and Losers: Fragmentation, Trade and Wages Revisited (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:diw:diwwpp:dp385

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