Offshoring and firm performance: self-selection, effects on performance, or both?

Joachim Wagner (1)

1 Leuphana University of Lüneburg

This paper uses unique new data for German manufacturing enterprises from matched regular surveys and a special purpose survey to investigate the causal effect of relocation of activities to a foreign country on firm performance. Compared to non-offshoring firms, firms that relocated activities were larger and more productive, and had a higher share of exports in total sales. These differences existed the year before some firms started to relocate, and this points to self-selection of "better" firms into offshoring. To investigate the causal effects of offshoring, six different variants of a matching approach are used. Contrary to what is often argued we find no evidence for a large negative causal effect of offshoring on employment in Germany.

Mots clés: Offshoring; Germany; Enterprise panel data; F23

Joachim Wagner. Offshoring and firm performance: self-selection, effects on performance, or both?. Review of World Economics, 2010, 147 (2), pp.217-247. ⟨10.1007/s10290-010-0078-2⟩. ⟨hal-00640228⟩