Munich Personal RePEc Archive

Time Zones, Shift Working and International Outsourcing

Matsuoka, Yuji and Fukushima, Marcelo (2009): Time Zones, Shift Working and International Outsourcing.

This is the latest version of this item.

[img]
Preview
PDF
MPRA_paper_20946.pdf

Download (142kB) | Preview

Abstract

We build a trade model with two identical countries located in different time zones and a monopolistically competitive sector of which production requires differentiated goods produced in two successive stages. We introduce shift working disutility and allow consumers to choose between day and night shifts. Shift working disutility raises the cost of night production and firms can reduce costs by “virtually” outsourcing foreign labor. We found that firms only outsource if relative costs of outsourcing are low and shift disutility is high. When outsourcing occurs under free trade, it generates the highest level of welfare among production modes. An intermediate range of shift working disutility can generate the lowest level of welfare and be not affected by the reduction of outsourcing costs.

Available Versions of this Item

UB_LMU-Logo
MPRA is a RePEc service hosted by
the Munich University Library in Germany.