Review of World Economics

, Volume 149, Issue 4, pp 631–662 | Cite as

Offshoring and the skill structure of labour demand

  • Neil Foster-McGregor
  • Robert Stehrer
  • Gaaitzen J. de Vries
Original Paper

Abstract

In this paper we examine the link between international outsourcing—or offshoring—and the skill structure of labour demand for a sample of 40 countries over the period 1995–2009. The paper uses data from the recently compiled World Input–Output Database to estimate a system of variable factor demand equations. These data allow us to exploit both a cross-country and cross-industry dimension and split employment into three skill categories. Our results indicate that while offshoring has impacted negatively upon all skill levels within industries, the largest impacts have been observed for medium-skilled workers. Such results are consistent with recent evidence indicating that medium-skilled workers have suffered to a greater extent than other skill types in recent years.

Keywords

Offshoring Trade Wages Labour demand 

JEL Classification

F14 J31 

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Copyright information

© Kiel Institute 2013

Authors and Affiliations

  • Neil Foster-McGregor
    • 1
  • Robert Stehrer
    • 1
  • Gaaitzen J. de Vries
    • 2
  1. 1.Vienna Institute for International Economic Studies (wiiw)ViennaAustria
  2. 2.Groningen Growth and Development CentreUniversity of GroningenGroningenThe Netherlands

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