Sectoral Adjustment of Employment: The Impact of Outsourcing and Trade at the Micro Level

Peter Egger, Michael Pfaffermayr and Andrea Weber

No 921, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper analyzes the effects of trade and outsourcing on the transition probabilities of employment between sectors, using a dynamic multinomial logit framework with fixed effects. The data contain individual Austrian male workers over the period 1988-2001. Our results strongly support the view that international economic forces are important determinants of labor market turnover. Increases in imports, terms of trade and, especially, in the outsourcing share negatively affect the probability of staying in or changing into the manufacturing sector, even more so for industries with a comparative disadvantage.

Keywords: dynamic discrete choice; outsourcing; labor market turnover; fixed effects panel estimation (search for similar items in EconPapers)
JEL-codes: C23 C25 F16 J63 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2003-11
New Economics Papers: this item is included in nep-dcm and nep-lab
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Citations: View citations in EconPapers (15)

Published - published as 'Sectoral adjustment of employment to shifts in outsourcing and trade: evidence from a dynamic fixed effects multinomial logit model' in: Journal of Applied Econometrics, 2007, 22 (3), 559-580

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Working Paper: Sectoral Adjustment of Employment: The Impact of Outsourcing and Trade at the Micro Level (2003)
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