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Do Immigrants Spur Offshoring?: Firm-Level Evidence
Örebro University, Orebro University School of Business, Örebro University, Sweden. Ratio, Stockholm, Sweden. (Internationell ekonomi)
Örebro University, Orebro University School of Business, Örebro University, Sweden. (Internationell ekonomi)
University of Nottingham, Nottingham, United Kingdom.
Örebro University, Swedish Business School at Örebro University. (Internationell ekonomi)ORCID iD: 0000-0003-0149-9598
(English)Manuscript (preprint) (Other academic)
Abstract [en]

Offshoring is an important aspect of firms’ internationalization. However, offshoring comes at a cost, especially where information or trust is lacking. Immigrant employees could reduce such offshoring costs through their knowledge of their former home countries and via access to foreign networks. We develop a framework of heterogeneous final-good firms to guide our empirical analysis and draw on new employer-employee data for approximately 12,000 Swedish firms during the time period 1998-2007. Our results support the hypothesis that immigrant employees spur offshoring activities by firms through lower offshoring costs. Hiring one additional foreign-born worker can increase offshoring up to three percent on average, with skilled migrants having the strongest effects. 

Keyword [en]
Offshoring, migration, networks, trust, information, trade barriers.
National Category
Economics
Research subject
Economics
Identifiers
URN: urn:nbn:se:oru:diva-54197OAI: oai:DiVA.org:oru-54197DiVA: diva2:1059937
Projects
Migration, integration och företagens globalisering - hur bidrar migration och integration i arbetslivet till företagens globalisering?
Funder
The Jan Wallander and Tom Hedelius Foundation, W2013-0425:1
Available from: 2016-12-26 Created: 2016-12-26 Last updated: 2017-01-10

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Karpaty, PatrikLodefalk, Magnus
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Orebro University School of Business, Örebro University, SwedenSwedish Business School at Örebro University
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