outsourcing, displacement, duration analysis, mass points
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The paper analyzes how international outsourcing affected individual employment
security. The analysis is carried out at the micro-level, combining monthly spell data
from household panel data and industry-level outsourcing measures. By utilizing
micro-level data, problems such as aggregation and potential endogeneity bias, as
well as crude skill approximations that regularly hamper industry level displacement
studies, can be reduced considerably. The main finding is that international
outsourcing significantly lowers individual employment security. Interestingly, the
effect does, however, not differ between high-, medium-, and low-skilled workers but
only varies with job duration.
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