Offshoring and Sequential Production Chains: A General-Equilibrium Analysis

Offshoring and Sequential Production Chains: A General-Equilibrium Analysis

In this paper, we develop a two-sector general equilibrium trade model which includes offshoring, sequential production, and endogenous market structures. We analyze how relative factor endowments and various forms of globalization and technological change affect equilibrium offshoring patterns. We...

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Bibliographic Details
Published in:MAGKS - Joint Discussion Paper Series in Economics (Band 02-2014)
Main Authors: Harms, Philipp, Jung, Jaewon, Lorz, Oliver
Format: Article
Language:English
Published: Philipps-Universität Marburg 2014
Subjects:
Wirtschaft
task trade.
sequential production
Offshoring
global production chain
Economics
Online Access:PDF Full Text
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Summary:In this paper, we develop a two-sector general equilibrium trade model which includes offshoring, sequential production, and endogenous market structures. We analyze how relative factor endowments and various forms of globalization and technological change affect equilibrium offshoring patterns. We show that, against common belief, a reduction in trade costs lowers the range of tasks offshored even though the aggregate volume of offshoring may increase.
Physical Description:32 Pages
ISSN:1867-3678
DOI:10.17192/es2024.0304

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