Journal Article

Services offshoring and wages: evidence from micro data

Ingo Geishecker and Holger Görg

in Oxford Economic Papers

Volume 65, issue 1, pages 124-146
Published in print January 2013 | ISSN: 0030-7653
Published online December 2011 | e-ISSN: 1464-3812 | DOI: https://dx.doi.org/10.1093/oep/gpr055
Services offshoring and wages: evidence from micro data

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  • International Trade
  • Wages, Compensation, and Labour Costs
  • Single Equation Models; Single Variables

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This paper investigates the effects of services offshoring on wages using individual-level data combined with industry information on offshoring for the United Kingdom. Our results show that services offshoring affects the real wage of low- and medium-skilled individuals negatively. By contrast, skilled workers may benefit from services offshoring in terms of higher real wages. Hence, offshoring has contributed to a widening of the wage gap between skilled and less skilled workers. This result is obtained while controlling for individual and sectoral observed and unobserved heterogeneity. In particular, our empirical model also controls for the impact of technological change and offshoring of materials.

Keywords: F16; J31; C23

Journal Article.  8462 words.  Illustrated.

Subjects: International Trade ; Wages, Compensation, and Labour Costs ; Single Equation Models; Single Variables

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