Template-Type: ReDIF-Paper 1.0
Title: Offshoring and Skill-upgrading in French Manufacturing
Author-Name: Juan Carluccio
Author-Email: 
Author-Name: Alejandro Cunat
Author-Email: 
Author-Name: Harald Fadinger
Author-Email:
Author-Name: Christian Fons-Rosen
Author-Email:
Classification-JEL: F11, F12, F14

Keywords: offshoring, heterogeneous firms, firm-level factor intensities, skill upgrading, Heckscher-Ohlin


Abstract: Using French manufacturing firm-level data for the years 1996 -2007, we uncover a novel set
of stylized facts about offshoring behavior: (i) Low-productivity firms ("non-importers") obtain
most of their inputs domestically. (ii) Medium-productivity firms offshore skill-intensive
inputs to skill-abundant countries and are more labor intensive in their domestic production
than non-importers. (iii) Higher-productivity firms additionally offshore labor-intensive
inputs to labor-abundant countries and are more skill intensive than non-importers. We develop
a model in which heterogeneous firms, subject to fixed costs, can offshore intermediate
inputs of different skill intensities to countries with different skill abundance. This leads to
endogenous within-industry variation in domestic skill intensities. We provide econometric evidence
supporting the factor-proportions channel through which reductions in offshoring costs
to labor-abundant countries have signicantly increased firm-level skill intensities of French
manufacturers.

Note: 
Length: 49
Creation-Date: 2018-05
Revision-Date: 
File-URL: https://www.crctr224.de/research/discussion-papers/archive/dp018
File-Format: application/pdf
Handle: RePEc:bon:boncrc:CRCTR224_2018_018