HOME » wiiw Seminar in International Economics » European Trade in Parts and Components: ...
Richard Frensch, Institute for East European Studies Regensburg and University of Regensburg
Recent empirical studies have been searching for evidence on and driving forces for offshoring. Typically, this search has been conducted by analysing gross trade flows related to offshored activities using gravity equations augmented by ad hoc measures of supply-side country differences. This paper suggests that gravity formulations of this sort are potentially mis-specified, due to theoretically unmotivated attempts of allowing for both complete and incomplete specialisation influences on gross trade flows within the same gravity framework. The paper suggests an alternative specification rooted in incomplete specialisation with complete specialisation as a natural limiting case. Re-sults support evidence for offshoring activities across Europe, driven by supply-side country differences compatible with models of incomplete specialisation and trade. Fur-ther interpretation of the results in the spirit of Grossman and Rossi-Hansberg (2008) suggests the conjecture that the latest waves of offshoring activities from 'old' to 'new' EU members may have been more likely to hurt (low-skill) workers in the old EU than offshoring to east Asia.
wiiw Seminar in International Economics
 |
European Trade in Parts and Components: Searching (for a Trade Model for Searching) for Offshoring Evidence (by Richard Frensch) wiiw Seminar in International Economics 17 June 2010, 5.30 p.m., Venue: wiiw, 1060 Vienna, Rahlgasse 3 FREE DOWNLOAD Keywords: offshoring, gravity JEL classification: F14, F16, L24 Topics: Other |
Richard Frensch, Institute for East European Studies Regensburg and University of Regensburg
Recent empirical studies have been searching for evidence on and driving forces for offshoring. Typically, this search has been conducted by analysing gross trade flows related to offshored activities using gravity equations augmented by ad hoc measures of supply-side country differences. This paper suggests that gravity formulations of this sort are potentially mis-specified, due to theoretically unmotivated attempts of allowing for both complete and incomplete specialisation influences on gross trade flows within the same gravity framework. The paper suggests an alternative specification rooted in incomplete specialisation with complete specialisation as a natural limiting case. Re-sults support evidence for offshoring activities across Europe, driven by supply-side country differences compatible with models of incomplete specialisation and trade. Fur-ther interpretation of the results in the spirit of Grossman and Rossi-Hansberg (2008) suggests the conjecture that the latest waves of offshoring activities from 'old' to 'new' EU members may have been more likely to hurt (low-skill) workers in the old EU than offshoring to east Asia.
Visitors who downloaded this publication/presentation also downloaded:
|
Reforming innovation systems in BY, KAZ and UA: Lost in Transition/Translation?” (by Hannes Leo) wiiw Seminar, 15 October 2012, 5 p.m., Venue: wiiw, Rahlgasse 3, 1060 Vienna DETAILS |
|
What went wrong in Slovenia and how to get out of the mess? (by Joze P. Damijan) wiiw Seminar Series 'EU in Crisis' 08 October 2012, 5 p.m., Venue: wiiw, 1060 Vienna, Rahlgasse 3 DETAILS |
|
The European Rim Countries - Challenges and Opportunities for EU Competitiveness (by Vasily Astrov, Peter Havlik, Mario Holzner, Gabor Hunya, Isilda Mara, Sandor Richter, Roman Stöllinger and Hermine Vidovic) wiiw Policy Note and Report No. 9, October 2012 49 pages including 3 Tables and 12 Figures DETAILS |
