Working Paper No. 654

The Effect of Offshoring on Labor Demand: Evidence from Sweden

Published: December 8, 2005, revised May 8, 2006Pages: 40Keywords: Offshoring; Labor Demand; Translog Cost Function; Factor-Biased Technological ChangeJEL-codes: F16

The Effect of Offshoring on Labor Demand: Evidence from Sweden Karolina Ekholm and Katariina Hakkala

We analyze the effects of offshoring of intermediate input production on labor demand in Sweden, distinguishing between workers with different educational attainments. The econometric results using data for the 1995-2000 period indicate that offshoring – in particular to low-income countries – tends to shift labor demand away from workers with an intermediate level of education. Offshoring to high-income countries, which is the largest component of overall offshoring, does not have any statistically significant effect on the composition of labor demand.

Interdisciplinary European Studies

The European Union and the Return of the Nation State

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This book explores the complex and ever-changing relationship between the European Union and its member states. The recent surge in tension in this relationship has been prompted by the actions of some member state governments as they question fundamental EU values and principles and refuse to implement common decisions seemingly on the basis of narrowly defined national interests.

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