TY - CEPII
A1 - Fergal McCann
TI - The Heterogeneous Effect of International Outsourcing on Firm Productivity
IS - 2010-06
T3 - Working Papers
KW - INTERNATIONAL OUTSOURCING
KW - HETEROGENEOUS FIRMS
KW - PRODUCTIVITY
KW - FIRM STRUCTURE
N2 - This paper analyses how international outsourcing affects plant productivity. The results point to a striking pattern: the status of being an outsourcer matters strongly for firms that are indigenous and not exporting, while for exporters and foreign affiliates, tfp increases are lower, insignificant and sometimes negative. On the other hand, higher intensity of outsourcing matters for both exporters and foreign affiliates. Similarly, in dynamic analysis, indigenous non-exporters are found to increase tfp for two periods after entering into international outsourcing, while indigenous exporters experience one more weakly significant period of growth. The message is clear: international outsourcing’s effect on tfp is most pronounced when it serves as a first exposure to international markets.
ER -