Department of Economics and Business Economics

Global Sourcing of Heterogeneous Firms: Theory and Evidence

Research output: Other contributionNet publication - Internet publicationCommunication

  • Wilhelm Kohler, University of Tubingen, Germany
  • Marcel Smolka, Denmark
The share of international trade within firm boundaries varies greatly across countries. This column presents new evidence on how the productivity of a firm affects the choice between vertical integration and outsourcing, as well as between foreign and domestic sourcing. The productivity effects found in Spanish firm-level data suggest that contractual imperfections distort the sourcing of inputs in the global economy, and that firm boundaries emerge in response to mitigate this distortion.
Original languageEnglish
Publication year20 Feb 2015
Publication statusPublished - 20 Feb 2015

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