Offshoring
general equilibrium effects on wages, production and trade
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Author
Contributions
- Robert-Nicoud, Frédéric - Contributor
- London School of Economics and Political Science. Centre for Economic Performance - Contributor
Publication
2007 - Centre for Economic Performance, London School of Economics and Political Science, London, England
Language
English
Word Count
0 words, Guess
Page Count
0 pages
Physical Format
Electronic resource
Identifiers
- Library of Congress Control Number2007618522
- Open LibraryOL31800855M
Classifications
- LCCHC10
Description
A simple model of offshoring is used to integrate the complex gallery of results that exist in the theoretical offshoring/fragmentation literature. The paper depicts offshoring as 'shadow migration' and shows that this allows straightforward derivation of the general equilibrium effects on prices, wages, production and trade (necessary and sufficient conditions are provided). We show that offshoring requires modification of the four HO theorems, so econometricians who ignore offshoring might reject the HO theorem when a properly specified version held in the data. We also show that offshoring is an independent source of comparative advantage and can lead to intra-industry trade in a Walrasian setting.
Subjects
Series Statement
- CEP discussion paper -- no. 794
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