Recent contributions on offshoring often assume that firms can freely split their production process into separate … technologically determined sequence of production steps. In our model, cost savings from offshoring fluctuate along the production … from offshoring even if relocating individual steps would be advantageous. Conversely, small variations in model parameters …

multinationals, are less likely to rely on imported or internally provided services. -- international trade ; services ; off-shoring …

. Such outsourcing leads to increased wages for the remaining inhouse production. We find that stronger unions, which imply … higher domestic wages, reduce incentives for international outsourcing. Though somewhat surprising, this result provides a … theoretical reconciliation of the empirically observed trends of deunionization and increased international outsourcing in many …