Institutions and offshoring behavior
This article tests whether institutions matter differentially across different sectors in offshoring behavior once the choice to invest abroad has already been made; i.e., how they affect trade between parent and foreign affiliates. Using data on US direct investment abroad, we find
that institutional characteristics of the country and industry positively affect the volume of offshoring between US companies and their affiliates. This also depends on the type of relationship between the parent company and its foreign affiliate. The suggested argument is stronger for intermediate
products, while evidence is weak for products ready for sale.
Keywords: Fragmentation of production; institutional quality; intra-firm trade; offshoring
Document Type: Research Article
Affiliations: Department of Economics and Management, University of Pavia, Pavia, Italy
Publication date: 04 March 2019
- Information for Authors
- Subscribe to this Title
- Ingenta Connect is not responsible for the content or availability of external websites
- Access Key
- Free content
- Partial Free content
- New content
- Open access content
- Partial Open access content
- Subscribed content
- Partial Subscribed content
- Free trial content