We propose and solve a simple model of firm-level decisions to offshore production stages of lower skill intensity than that of activities that remain in the domestic location. In theory, offshoring is optimal only for the more productive among heterogeneous firms if it entails a fixed cost. In a large sample of Italian firms, offshoring - especially of intermediate production stages - is indeed more prevalent among firms that are larger and more productive, and is predicted by arguably relevant firm-level characteristics. We also document that offshoring decreases the share of unskilled employment in domestic production facilities as well as firms’ propensity to employ immigrant workers, and we discuss the possible determinants and policy implication of the latter finding

Offshoring and immigrant employment : firm level theory and evidence / G. Barba Navaretti, G. Bertola, A. Sembenelli. - London : Centre for economic policy research, 2008 Mar.

Offshoring and immigrant employment : firm level theory and evidence

G. Barba Navaretti
Primo
;
2008

Abstract

We propose and solve a simple model of firm-level decisions to offshore production stages of lower skill intensity than that of activities that remain in the domestic location. In theory, offshoring is optimal only for the more productive among heterogeneous firms if it entails a fixed cost. In a large sample of Italian firms, offshoring - especially of intermediate production stages - is indeed more prevalent among firms that are larger and more productive, and is predicted by arguably relevant firm-level characteristics. We also document that offshoring decreases the share of unskilled employment in domestic production facilities as well as firms’ propensity to employ immigrant workers, and we discuss the possible determinants and policy implication of the latter finding
mar-2008
Outsourcing ; Migration ; Foreign direct investments ; Skilled Labour
Settore SECS-P/01 - Economia Politica
Centro studi Luca D'Agliano
www.cepr.org/pubs/dps/DP6743.asp.asp
Working Paper
Offshoring and immigrant employment : firm level theory and evidence / G. Barba Navaretti, G. Bertola, A. Sembenelli. - London : Centre for economic policy research, 2008 Mar.
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/2434/46805
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