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Helmut-Schmidt-Universität (HSU), Hamburg >
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Diskussionspapiere, Fächergruppe VWL, Helmut-Schmidt-Universität >
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http://hdl.handle.net/10419/38727
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| Title: | | The elasticity of substitution and the sector bias of International Outsourcing: Solving the puzzle  |
| Authors: | | Horgos, Daniel |
| Issue Date: | | 2009 |
| Series/Report no.: | | Diskussionspapier // Helmut-Schmidt-Universität, Universität der Bundeswehr Hamburg, Fächergruppe Volkswirtschaftslehre 88 |
| Abstract: | | Considering the sector bias of International Outsourcing within a 2x2 framework, four different scenarios appear. Each industry can either relocate its high or its low skill intensive production fragment. Traditionally, depending on the superiority of a wage vs. an outsourcing-effect, general equilibrium effects of two scenarios are assumed to be ambiguous. Applying a formal duality approach and a calibration exercise for the German economy, this contribution shows that a focus on the elasticity of substitution can solve the puzzle. With the elasticity exceeding a critical value, unambiguous results in all four scenarios appear, supporting the sector bias of International Outsourcing. |
| Subjects: | | International Outsourcing Sector Bias Elasticity of Substitution |
| JEL: | | F16 F41 E25 |
| Persistent Identifier of the first edition: | | urn:nbn:de:gbv:705-opus-19193 |
| Document Type: | | Working Paper |
| Appears in Collections: | | Diskussionspapiere, Fächergruppe VWL, Helmut-Schmidt-Universität
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