Outsourcing and Firm Productivity in Irish Manufacturing

Arbeitspapier

The causality from outsourcing, defined as the procurement of inputs from outside the boundaries of the firm, to productivity is tested for a large panel of Irish manufacturing firms. Theory suggests that as firms outsource more 'non-core' activities to specialized providers, productivity due to the firm benefiting from cheaper or higher-quality inputs and from reallocation of resources towards higher value-added activities. The international outsourcing case adds another dimension in the form of input variety, quality and technological embeddedness. I test the above hypothesis using a "System GMM" estimator to control for endogeneity in the panel and allow for a lagged dependent variable to be a regressor. International outsourcing is found to lead to productivity gains, but upon closer inspection it seems that firms? international orientation and type of industry both matter.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: FIW Working Paper ; No. 21

Classification and Topics

• Classification: Wirtschaft ; Multinational Firms; International Business ; Organization of Production
• Subject: Outsourcing ; Productivity ; Firm Structure

Contributors, Location and Time

• Event: Geistige Schöpfung
• (who): McCann, Fergal
• Event: Veröffentlichung
• (who): FIW - Research Centre International Economics
• (where): Vienna
• (when): 2009

Further information

• Handle: http://hdl.handle.net/10419/121022
• Last update: 10.03.2025, 11:43 AM CET