Arbeitspapier

Offshoring, tasks, and the skill-wage pattern

The paper investigates the relationship between offshoring, wages, and the ease with which individuals' tasks can be offshored. Our analysis relates to recent theoretical contributions arguing that there is only a loose relationship between the suitability of a task for offshoring and the associated skill level. Accordingly, wage effects of offshoring can be very heterogeneous within skill groups. We test this hypothesis by combining micro-level information on wages and demographic and workplace characteristics as well as occupational infor- mation relating to the degree of offshorability with industry-level data on offshoring. Our main results suggest that in partial equilibrium, wage effects of offshoring are fairly modest but far from homogeneous and depend significantly on the extent to which the respective task requires personal interaction or can be described as non-routine. When allowing for cross-industry movement of workers, i.e., looking at a situation closer to general equilibrium, the magnitude of the wage effects of offshoring becomes substantial. Low- and medium-skilled workers experience significant wage cuts due to offshoring which, however, again strongly depend on the degree of personal interaction and non-routine content.

Language
Englisch

Bibliographic citation
Series: Kiel Working Paper ; No. 1603

Classification
Wirtschaft
Subject
Tasks
offshoring
outsourcing
skills
wages
Offshoring
Lohnstruktur
Arbeitsplatz
Qualifikation
Anforderungsprofil
Industriearbeit
Verarbeitendes Gewerbe
Deutschland

Event
Geistige Schöpfung
(who)
Baumgarten, Daniel
Geishecker, Ingo
Görg, Holger
Event
Veröffentlichung
(who)
Kiel Institute for the World Economy (IfW)
(where)
Kiel
(when)
2010

Handle
Last update
10.03.2025, 11:42 AM CET

Data provider

This object is provided by:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.

Object type

  • Arbeitspapier

Associated

  • Baumgarten, Daniel
  • Geishecker, Ingo
  • Görg, Holger
  • Kiel Institute for the World Economy (IfW)

Time of origin

  • 2010

Other Objects (12)