Specialization, outsourcing and wages

Arbeitspapier

This paper studies the impact of outsourcing on individual wages. In contrast to the standard approach in the literature, we focus on domestic outsourcing as well as foreign outsourcing. By using a simple theoretical model, we argue that, if outsourcing is associated with specialization gains arising from an increase in the division of labor, domestic outsourcing tends to increase wages for both unskilled and skilled labor. We use a panel data set of workers in Danish manufacturing industries to show that domestic and foreign outsourcing affect wages as predicted by the theory.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 1907

Classification and Topics

• Classification: Wirtschaft ; Trade and Labor Market Interactions ; Wage Level and Structure; Wage Differentials ; Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models
• Subject: outsourcing ; comparative advantage ; specialization ; wages ; Outsourcing ; Komparativer Kostenvorteil ; Internationale Arbeitsteilung ; Lohnniveau ; Verarbeitendes Gewerbe ; Schätzung ; Panel ; Dänemark

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Munch, Jakob Roland ; Rose Skaksen, Jan
• Event: Veröffentlichung
• (who): Institute for the Study of Labor (IZA)
• (where): Bonn
• (when): 2005

Further information

• Handle: http://hdl.handle.net/10419/33383
• Last update: 15.04.20252025, 7:02 PM CEST