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Germany exhibits a strong reduction in domestic manufacturing production depth (bazaar effect). I argue that this reflects an unbundling of comparative advantage. Using a model where Ricardian plus Heckscher-Ohlin-type comparative advantage relates to fragments of production, I compare a trading...
Persistent link: https://www.econbiz.de/10005181377
Economic globalization causes an increasing international fragmentation (disintegration) of value-added-chains, whereby firms outsource components of production to foreign markets. There is a high level of concern about unwelcome distributional effects. This paper provides a theoretical...
Persistent link: https://www.econbiz.de/10010294506
International fragmentation, or outsourcing, is often referred to as a distinctly novel feature in today's global … outsourcing targets for western European firms. Against this background this paper provides a policy-oriented discussion of cross … European point of view. Specifically, the paper idetifies conditions under which outsourcing is beneficial for a western …
Persistent link: https://www.econbiz.de/10010294567
fragmentation may cause a domestic welfare loss, because outsourcing takes place in discrete steps where it affords firms quasi … process of fragmentation caused by less costly outsourcing is beneficial for the domestic economy. …
Persistent link: https://www.econbiz.de/10010294583
outsourcing, or international fragmentation. Economists have investigated this phenomenon with a focus on welfare and factor price … welfare efect of outsourcing. Moreover, the paper highlights a crucial distinction between outsourcing that takes place in an … firms must rely on arms-length trasactions. The results are as follows. a) With foreign direct investment, outsourcing which …
Persistent link: https://www.econbiz.de/10010294605
. The paper identifies conditions under which outsourcing to a low-wage country is a friend or an enemy to domestic labour …
Persistent link: https://www.econbiz.de/10010294622
Persistent link: https://www.econbiz.de/10009554592
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...
Persistent link: https://www.econbiz.de/10010336794
Which firms find it optimal to integrate their input suppliers into the firm boundaries of control (vertical integration)? Which firms choose to expand their sourcing activities across the national border (offshoring)? This letter provides novel evidence on these questions based on a Spanish...
Persistent link: https://www.econbiz.de/10010199514
. The paper identifies conditions under which outsourcing to a low-wage country is a "friend" or an "enemy" to domestic …
Persistent link: https://www.econbiz.de/10009749606