We construct a model of offshoring with externalities and firm heterogeneity. Due to the presence of externalities …, temporary shocks like the Y2K problem can have permanent effects, i.e., they can permanently raise the extent of offshoring in … an industry. Also, the initial advantage of a country as a potential host for outsourcing activities can create a lock in …

unemployment decreases upon offshoring in the presence of perfect intersectoral labor mobility. If, as a result, labor moves to the … intersectoral labor mobility, unemployment in the offshoring sector can rise, with an unambiguous unemployment reduction in the non-offshoring … unemployment in this sector rising. -- Trade ; offshoring ; search ; unemployment …

decreases. Next we allow for offshoring of unskilled jobs in our model, and we find that, as a result, it becomes more likely … that the fair-wage constraint binds. Offshoring of unskilled jobs always leads to an increase in skilled wage, a decrease … adverse impact of offshoring on unskilled unemployment. The unskilled wage can increase or decrease as a result of offshoring …

In this paper, in order to study the impact of offshoring on sectoral and economywide rates of unemployment, we … offshoring. This result can be understood to arise from the productivity enhancing (cost reducing) effect of offshoring. If the … search cost is identical in the two sectors, or even if the search cost is higher in the sector which experiences offshoring …

Offshoring is generally believed to be productivity-enhancing and this belief is underpinned by economic theory. This … article contributes to the growing literature that tests empirically whether offshoring does indeed help to improve … productivity. Estimating the impact of materials and business services offshoring on productivity growth with industry-level data …

The fear of massive job losses has prompted a fast-growing literature on offshoring and its impact on employment in … advanced economies. This paper examines the situation for Belgium. It improves the offshoring intensity measure by computing a … business services offshoring to high-wage and low-wage countries. Estimations of static and dynamic industry-level labour …