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ifo Institut – Leibniz-Institut für Wirtschaftsforschung an der Universität München >
CESifo Working Papers, CESifo Group Munich >
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http://hdl.handle.net/10419/39002
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| Title: | | A simple model of service offshoring with time zone differences  |
| Authors: | | Kikuchi, Toru Long, Ngo Van |
| Issue Date: | | 2010 |
| Series/Report no.: | | CESifo working paper Trade Policy 2990 |
| Abstract: | | We propose a two-country monopolistic competition model of business service offshoring that captures the advantage conferred by time zone differences. We emphasize the role of the entrepreneurs, who decide how to produce business services (i.e., domestic service provision or service offshoring). It is shown that the utilization of communication networks induces a dramatic change in industrial structure due to entrepreneurial relocation (i.e., service offshoring) to take advantage of time zone differences. We also show that in the presence of moving costs for entrepreneurs, technological improvements and the resulting increase in service offshoring may reduce a country's welfare. |
| Subjects: | | service offshoring time zone differences technological change entrepreneurs communication networks |
| JEL: | | F12 |
| Document Type: | | Working Paper |
| Appears in Collections: | | CESifo Working Papers, CESifo Group Munich
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