Offshore Outsourcing of Information Services and its Effect on Productivity in Japan

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  • TAKAGI Soichiro
    Ph.D Candidate, Graduate School of Interdisciplinary Information Studies, The University of Tokyo
  • TANAKA Hideyuki
    Graduate School of Interdisciplinary Information Studies, The University of Tokyo

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  • 大会関連論文 Offshore Outsourcing of Information Services and its Effect on Productivity in Japan
  • タイカイ カンレン ロンブン Offshore Outsourcing of Information Services and its Effect on Productivity in Japan

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Abstract

<p> Outsourcing of information services to overseas providers has become popular in the last decade. The effects of the outsourcing on the economy in developed countries are discussed, especially on employment. However, productivity in developed economies is also assumed to be affected by offshore outsourcing, because it affects cost share of intermediate inputs and technology to utilize inputs. </p> <p> This study calculates the amount of offshore outsourcing of information services using Input-Output table of JIP 2009 database. In the analysis on productivity, the effects of the traditional outsourcing and information services outsourcing and IT stock on Total Factor Productivity (TFP) are assessed. </p> <p> The results show that TFP is lowered in the year of increase of input share of traditional outsourcing, information services outsourcing, and IT stock. However, those negative effects turn to positive or neutral in the second year. From sectoral perspective, manufacturing sector benefits from information services outsourcing, and service sector benefits from tradition outsourcing in the lagged analysis.</p>

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