Documents Ziesemer, Thomas 2 results

"This paper studies the direct and indirect channels through which offshoring affects the domestic skillwage structure and employment opportunities. To identify these channels, we develop a task-based model with unemployment that accounts for skill heterogeneity and endogenous allocation of domestic tasks to skill groups and abroad. A decline in offshoring costs of medium skill-intensive tasks induces i) a specialization effect towards low and high skill-intensive tasks, explaining one source of wage polarization, ii) an internal skill-task reallocation effect, and iii) a productivity effect due to production cost reductions. The key determinants of these channels are the elasticity of substitution between domestic and offshore tasks and the elasticity of task productivity schedules between domestic skill groups and between domestic and offshore workers across tasks."

"This paper analyzes the impact of the skill composition of migration flows on the host country's labor market in a specific factors two-sector model with heterogeneous labor (low-, medium-, and highly-skilled) and price- and wage-setting behavior. The low- and medium-skilled labor markets are characterized by frictions due to wage bargaining. Moreover, we assume skill downgrading of unemployed medium-skilled workers into low-skilled labor supply. Endogenous benefits create an interdependency between the two bargaining processes. Particular attention is paid to medium-skilled migration, which enables us to contribute to the literature by replicating important stylized facts regarding medium skills, such as i) the interaction between immigration, low-skilled unemployment, and medium skill downgrading, ii) the increase in low skill intensive service jobs. The model is calibrated using data for Germany. The key findings are: (i) a migration-induced supply shock of medium skilled workers decreases the low-skilled unemployment rate under endogenous benefits; (ii) migration of only medium skilled labor has a neutral impact on GDP per capita; (iii) immigration of medium skilled labor together with some high skilled labor has a positive effect on output per capita."