Global Sourcing: Towards an Empirical Test of the Hold-up Model

Wilhelm Kohler and Marcel Smolka

VfS Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order from Verein für Socialpolitik / German Economic Association

Abstract: We use Spanish firm-level data to test the hold-up model of global sourcing proposed by Antr s & Helpman (2004). We propose a novel representation of the model which guides us in bringing the theory to the data. We estimate a discrete choice model of firms' sourcing behavior, separately for the location choice and the ownership choice of sourcing. We find that a firm's productivity interacts with an industry's headquarter intensity in governing both dimensions of sourcing in the way suggested by the Antras-Helpman model. In addition, estimated ``ex ante sourcing premia'' of firms lend brought support to the idea that firms self-select into sourcing activities.

JEL-codes: F12 F14 F23 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-dcm and nep-int
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:vfsc13:80049

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