The Labor-market Effects of Service Offshoring: A Synthetic Control Approach with High-dimensional Microdata

Abstract

I use novel high-quality survey data on firms’ international sourcing activities combined with firm-level financial and linked employer–employee data to study the effect of services offshoring on wages and employment. To overcome the endogeneity related to reverse causality and omitted variables, I use microsynth, a variation of the synthetic control method specially developed for high-dimensional microdata. I find that offshoring firms pay higher wages for both high-skilled and low-skilled workers, and employ fewer FTE workers compared with a synthetic control, but these effects take several years to appear.

Information om publikationen

Forskningsgrupp
Makroekonomi och den offentliga ekonomin
Serie
ETLA Working Papers 97
Datum
28.10.2022
Nyckelord
Service offshoring, Offshoring
ISSN
2323-2420, 2323-2439 (Pdf)
JEL
F14, C33, J31
Sidor
42
Språk
Engelska