Interlocking margins: A framework on the interaction of offshoring and outsourcing decisions

Vol: 
53/2021
Author name: 
Jiang E
Year: 
2021
Month: 
July
Abstract: 

I develop a multi-country general equilibrium model on global sourcing which considers individual firm’s decisions on outsourcing as well as offshoring. These decisions are closely connected as more extensive offshoring provides incentives for further integration of inputs. The firm-level decisions aggregate to produce gravity style equations of trade flows between countries, and intra-firm transactions.

Publication file: 

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