2,356 research outputs found

    Outsourcing Jobs? Multinationals and US Employment

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    Critics of globalization claim that US manufacturing firms are being driven to shift employment abroad by the prospects of cheaper labor. Others argue that the availability of low-wage labor has allowed US based firms to survive and even prosper. Yet evidence for either hypothesis, beyond anecdotes, is slim. Using firm-level data collected by the US Bureau of Economic Analysis (BEA), we estimate the impact on US manufacturing employment of changes in foreign affiliate wages, controlling for changing demand conditions and technological change. We find that the evidence supports both perspectives on globalization. For firms most likely to perform the same tasks in foreign affiliates and at home ("horizontal" foreign investment), foreign and domestic employees appear to be substitutes. For these firms, lower wages in affiliate locations are associated with lower employment in the US. However, for firms which do significantly different tasks at home and abroad ("vertical" foreign investment), foreign and domestic employment are complements. For vertical foreign investment, lower wages abroad are associated with higher US manufacturing employment. These offsetting effects may be combined to show that offshoring is associated with a quantitatively small decline in manufacturing employment. Other factors, such as declining prices for consumer goods, import competition, and falling prices for investment goods (which substitute for labor) play a more important role.

    Does Direct Foreign Investment Affect Domestic Firms' Credit Constraints?

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    Firms in developing countries cite credit constraints as one of their primary obstacles to investment. Direct foreign investment, by bringing in scarce capital, may ease domestic firms' credit constraints. Alternatively, if foreign firms borrow heavily from domestic banks, they may exacerbate domestic firms' credit constraints by crowding them out of domestic capital markets. One plausible mechanism by which this may happen is indirect. Foreign firms may be more experienced and have better financial ratios and thus, be a safer bet for lending institutions. Using firm-level data from the Ivory Coast for the period 1974-1987 we test the following hypotheses: (1) domestic firms are more credit constrained than foreign firms and (2) borrowing by foreign firms exacerbates the credit constraints of domestic firms. Results suggest that domestic firms are significantly more credit constrained that foreign firms and that borrowing by foreign firms aggravates domestic firms' credit constraints. By splitting the sample into state-owned (SOE) and privately owned domestic enterprises we are able to show that SOEs are less financially constrained than other domestic enterprises, consistent with the notion of a 'soft budget constraint'. Borrowing by foreign firms affects only privately owned enterprises. Finally, we explore possible explanations for the crowding out effect.

    Recent perspectives on trade and inequality

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    The 1990's dealt a blow to traditional Heckscher-Ohlin analysis of the relationship between trade and income inequality, as it became clear that rising inequality in low-income countries and other features of the data were inconsistent with that model. As a result, economists moved away from trade as a plausible explanation for rising income inequality. In recent years, however, a number of new mechanisms have been explored through which trade can affect(and usually increase) income inequality. These include within-industry effects due to heterogeneous?firms; effects of offshoring of tasks; effects on incomplete contracting; and effects of labor-market frictions. A number these mechanisms have received substantial empirical support.Labor Markets,Economic Theory&Research,Labor Policies,Trade Policy,Emerging Markets

    US multinational activity abroad and US jobs: substitutes or complements?

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    Critics of globalization claim that firms are being driven by the prospects of cheaper labor and lower labor standards to shift employment abroad. Yet the evidence, beyond anecdotes, is slim. This paper reports stylized facts on the activities of U.S. multinationals at home and abroad for the years 1977 to 1999. We focus on firms in manufacturing and services, two sectors that have received extensive media attention for supposedly exporting jobs. Using firm-level data collected by the Bureau of Economic Analysis (BEA) in Washington, D.C., we report correlations between U.S. multinational employment at home and abroad. Preliminary evidence based on the operations of these multinationals suggests that the sign of the correlation depends on the crucial distinction between affiliates in high-income and low-income countries. For affiliates in high-income countries there is a positive correlation between jobs at home and abroad, suggesting that foreign employment of U.S. multinationals is complementary to domestic employment. For firms that operate in developing countries, employment has been cut in the United States, and affiliate employment has increased. To account for firm size, substitution across firms and entry and exit, we aggregate our data to the industry level. This exercise reveals that the observed “complementarity” between U.S. and foreign jobs has been driven largely by a contraction across all manufacturing sectors. It also reveals that foreign employment in developing countries has substituted for U.S. employment in several highly visible industries, including computers, electronics, and transportation.multinational corporations; offshoring; employment

    Recent findings on trade and inequality:

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    The 1990's dealt a blow to traditional Heckscher-Ohlin analysis of the relationship between trade and income inequality, as it became clear that rising inequality in low- income countries and other features of the data were inconsistent with that model. As a result, economists moved away from trade as a plausible explanation for rising income inequality. In recent years, however, a number of new mechanisms have been explored through which trade can affect (and usually increase) income inequality. These include within-industry effects due to heterogeneous firms; effects of offshoring of tasks; effects on incomplete contracting; and effects of labor-market frictions. A number of these mechanisms have received substantial empirical support.trade inequality,

    (Re)producing power-knowledge-desire : young women and discourses of identity

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    This study focuses on three young women in their final year of school using data gathered during a year-long process of individual conversational interviews, the contents of which were largely determined by their interests. Three themes arise from critical incidents during this year - the debutante ball, teenage pregnancy and dieting. These themes are used to focus wide ranging explorations of what it is to be a young woman at this particular time. The broader cultural production of discursive positions available to, and developed by, these young women as part of their identity formation is discussed. Methodological issues concerning power relationships between research participants are also the focus of critical attention. It is considered that young women\u27s bodies and bodily practices are central to understanding the processes involved in their identity formation. It is in this context that the focus turns to bodies that matter. In contemporary Western cultures \u27adolescent bodies\u27 could be said to matter \u27too much\u27 in the sense that they are increasingly the focus for disciplinary practices in institutions such as schooling, the church, the family, health care, health promotion and the media. This disciplining is legitimised because adolescence is socially constructed as a \u27becoming\u27. In this case it is a matter of \u27becoming woman\u27; a sort of apprenticeship which allows for knowledgeable others to provide not only guidance and nurturance, but discipline. Using insights gained from feminist poststructuralist theory and cultural feminism this thesis argues that the discourses and practices generated within and across institutions, which are normalised by their institutional base, are gender differentiated. The focus is on young women\u27s embodied subjectivity and how the discourses and practices they engage with and in work to construct an ideal feminine body-subject. The discursive production of a gendered identity has a considerable impact on young women\u27s health and their health-related behaviours. This is explored specifically in the thesis in relation to sexuality and the cultural production of the \u27ideal\u27 female body. It is argued that health education and health promotion strategies which are designed to influence young women\u27s health related behaviours, need to consider the forms of power, knowledge and desire produced through young women\u27s active engagement with institutionalised discourses of identity if they are to have an ongoing impac

    Only Call Us Faithful: A Novel of the Union Underground

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    Spectre of a spy A ghostly retelling of the life of Liza Van Lew Marie Jakober has written a Civil war novel that is both intriguing and refreshing. It is a distant, wispy yet compelling story that draws the reader in like fog rising from the James River might draw a boat toward ...

    The Black Ghost of the Pampas, Juan Draghi Lucero

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    Estimating the Impact of Trade and Offshoring on American Workers Using the Current Population Surveys

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    In this paper, we link industry-level data on offshoring activities of U.S. multinational firms, import penetration, and export shares with individual level worker data from the Current Population Surveys. We examine whether increasing globalization through offshoring or trade has led to reallocation of labor, both within and out of manufacturing, and measure its impact on the wages of domestic workers. We also control for the "routineness" of individual occupations. Our results suggest that (1) offshoring to high wage countries is positively correlated with U.S. manufacturing employment (2) offshoring to low wage countries is associated with U.S. employment declines (3) wages for workers who remain in manufacturing are generally positively affected by offshoring; in particular, we find that wages are positively associated with an increase in U.S. multinational employment in high income locations (4) much of the negative effects of globalization operate through downward pressure on wages of workers who leave manufacturing to take jobs in agriculture or services and (5) the downward pressure on aggregate U.S. wages operating through import competition has been quite important for some occupations. This effect has been overlooked because it operates across, not within, industries.
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