Offshoring and sequential production chains : a general-equilibrium analysis

Philipp Harms, Jaewon Jung, and Oliver Lorz

In this paper, we develop a two-sector general equilibrium trade model which includes offshoring, sequential production, and endogenous market structures. We analyze how relative factor endowments and various forms of globalization and technological change affect equilibrium offshoring patterns. We show that, against common belief, a reduction in trade costs lowers the range of tasks offshored even though the aggregate volume of offshoring may increase.

MoreLess

Year of publication:	2014 ; This version: January 5, 2014
Authors:	Harms, Philipp ; Jung, Jaewon ; Lorz, Oliver
Publisher:	Marburg : Univ., Dep. of Business Administration & Economics
Subject:	Offshoring \| sequential production \| global production chain \| task trade \| Auslandsverlagerung \| Theorie \| Theory \| Allgemeines Gleichgewicht \| General equilibrium \| Lieferkette \| Supply chain \| Internationale Produktion \| International production \| Produktivität \| Productivity \| Vorleistungen \| Intermediate goods \| Internationale Arbeitsteilung \| International division of labour