The Nature of Outsourcing Relationships: Evidence from OAP Prices
نویسنده
چکیده
This paper studies the extent and variation in production cost pass-through for U.S. outsourcing imports. Data from 4,676 products imported through the U.S. overseas assembly program (OAP) show that outsourcing imports were characterized by incomplete pass-through of production and trade costs to import prices. Notably, passthrough was higher for products assembled in high education countries while the response of outsourcing import prices to competing suppliers’ prices was largest for products sold by firms in capital-intense industries. The reasons for these cross-country and cross-industry differences, as they relate to theories of outsourcing and trade, are explored. . JEL Code: F1 Trade, F2 International Factor Movements
منابع مشابه
Outsourcing and Pass-Through: Evidence from OAP Prices
This paper studies the extent and variation in import price pass-through for U.S. outsourcing imports. Based on data from 4,676 outsourcing products imported between 1991 and 2000 an average pass-through rate of seventy-five percent is found. The data also show that outsourcing import prices are influenced by the prices chosen by competing import suppliers. Notably, both the rate of pass-throug...
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