International Outsourcing, Unemployment and Welfare: A Re-Examination
| Autor: | Jai-Young Choi, Eden S. H. Yu |
|---|---|
| Jazyk: | angličtina |
| Rok vydání: | 2019 |
| Předmět: | |
| Zdroj: | East Asian Economic Review, Vol 23, Iss 3, Pp 261-284 (2019) |
| Druh dokumentu: | article |
| ISSN: | 2508-1640 2508-1667 |
| DOI: | 10.11644/KIEP.EAER.2019.23.3.363 |
| Popis: | This paper explores the ramifications of international outsourcing on unemployment, income distribution and welfare, which is an important but yet unresolved issue. Using the well-known Harris-Todaro (1970) model of sector-specific unemployment, it shows that the effects of outsourcing on employment, income-distribution and welfare depend on the sector in which the outsourcing occurs, whereby sectoral factor intensities, unemployment-outsourcing response and the dynamic stability condition play crucial roles. In particular, outsourcing in the manufacturing (primary) sector widens (narrows) income inequality by increasing (decreasing) the sectoral wage gap and raising (not affecting) the rental income of the capital owners in the economy. Moreover, outsourcing in the manufacturing (primary) sector can be welfare-decreasing (is always welfareincreasing) due to its negative (positive) employment effect mitigating (reinforcing) the primary gains from the outsourcing. |
| Databáze: | Directory of Open Access Journals |
| Externí odkaz: |
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