Friday, March 12, 2004

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An outsourcing bibliography

Welcome, Foreign Affairs readers! If you want to comment on the essay, please go to this blog entry. If you're reading this it means you want to know where all the facts, figures, and quotations from "The Outsourcing Bogeyman" came from. I don't blame you -- as an academic, I'm leery of publishing an essay without the proper acknowledgments and citations.


Bruce Bartlett and Sreenath Sreenivasan provided useful and informative links to the outsourcing phenomenon. Many thanks to Virginia Postrel, Sebastian Rosato, and Nick Schulz for reading draft versions of the article and providing trenchant feedback. I am also grateful to Daniel Kurtz-Phelan, Gideon Rose, and James F. Hoge, Jr. at Foreign Affairs for their sage advice during the drafting process. Through their links and commentary, Tyler Cowen, Brad DeLong, Mickey Kaus, Glenn Reynolds, and especially Virginia Postrel made the writing of this essay considerably easier.

A crude version of this paper was delivered -- crudely -- to my American Foreign Economic Policy class a few weeks ago (amusing side note: I had planned to give a lecture on the topic when I drafted the syllabus back in November. The week I wound up delivering it was coincidentally the same week outsourcing was the cover story of Economist, Time, Business Week and Wired. The students were very impressed with the topicality). They provided me with excellent feedback. And finally, lots of blog readers posted their own comments in response to my myriad posts on the subject. Agree or disagree, their feedback helped me to figure out how best to frame my arguments.

Sources for quotations:

Mankiw's comments come from Warren Vieth and Edwin Chen, “Bush Supports Shift of Jobs Overseas,” Los Angeles Times, 10 February 2004. Reaction comments from Edmund Andrews, “Democrats Criticize Bush Over Job Exports,” New York Times, 11 February 2004. I posted about this here.

Stephen Roach's comment comes from "Debating the Jobless Recovery" on the Morgan Stanley web site. It should be noted that Roach is hardly an advocate of protectionism.

The IBM official was quoted in Bob Herbert, “White-Collar Blues,” New York Times, 29 December 2003. Nilekani was quoted in Steve Lohr, “Many New Causes for Old Problem of Jobs Lost Abroad,” New York Times, 15 February 2004. Fiorina's statement came from Carolyn Lochhead, “Economists Back Tech Industry’s Overseas Hiring,” San Francisco Chronicle, 9 January 2004.

The billboard quotation came from Elizabeth Becker, “Globalism Minus Jobs Equals Campaign Issue,” New York Times, 30 January 2004. Kerry's line about "Benedict Arnold CEO's" has been everywhere, but here's James K. Glassman's use of it.

Tom Daschle's later quote comes from Ted Landphair, “Outsourcing, Costly for US Workers, an Issue in Election Year,” Voice of America, 7 February 2004. Robert McTeer's very funny line comes from “Delta Air, General Electric Say Creating Jobs Abroad Helps U.S.,” Bloomberg, 23 February 2004. The Bloomberg story was also the source of information regarding how Delta Air Lines was able to create additional American jobs via offshore outsourcing.

While not a quote, the Commerce Department report I referenced is Raymond J. Mataloni, Jr., “U.S. Multinational Companies: Operations in 2001,” Survey of Current Business, November 2003. The relevant passage is on p. 89.

Sources for numbers:

Many of the sources can be found in the general references below. For the plethora of job loss projections, I relied on Clay Risen's “Missed Target," The New Republic, 2 February 2004; and CIO Magazine, “Offshore Outsourcing – The Backlash,” September 2003.

On the gap between Gartner's estimation of firm-specific job losses due to outsourcing versus Joglekar's estimates, see Thomas Hoffman, “Researcher Says Offshore Moves Don’t Leave to Big U.S. Job Losses,” ComputerWorld, 22 December 2003. Professor Joglekar was also kind enough to speak to me by phone -- I wish more of what he said could have fit into the final version of the essay.

On the overestimation of call center outsourcing, see Dick O’Brien, “Outsourcing threat is overstated,” ElectronicNews.Net, 26 January 2004. The TPI estimates came from this press release and this report comparing European and American outsourcing trends. See also Justin Pope, "Some Managers Hold Firm Against Pressure to Move IT Jobs Overseas," Associated Press, 1 February 2004.

The effect of sugar tariffs on jobs come from Aaron Lukas, “A Sticky State of Affairs: Sugar and the U.S. Australia Free-Trade Agreement,” Center for Trade Policy Studies, 9 February 2004. The total effect of steel tariffs on jobs was calculated based on annual costs projected in Gary Clyde Hufbauer and Ben Goodrich, “Next Move in Steel: Revocation or Retaliation,” Institute for International Economics Policy Brief 03-10, October 2003, p. 10.

IBM's fund for displaced workers can be read about in Stacy Cowley, “IBM Starts Fund to Aid Displaced Workers,” ComputerWorld, 2 March 2004.

The data on manufacturing output and employment can be found in this Alliance Capital Management report.

Data on insourcing comes from Michael Walden, “A Potent ‘Insource’ of U.S. Jobs,” Raleigh News and Observer, 2 February 2004, Lawrence Kudlow, "Outsourcing ‘Outrage,’" New York Post, 3 March 2004, as well as the Commerce Department.

Facts about the trade adjustment assistance program can be accessed at the U.S. Department of Labor's Employment and Training Administration Fact Sheet.

General references on outsourcing:

Space constraints made it difficult to cite them in the piece, but two worthwhile sources are Sreenath Sreenivasan's outsourcing page, which has tons of links, and Alan Greenspan's recent speeches and testimony that touch on the subject -- here, here, and here. Brink Lindsey has just written a policy brief, "Job Losses and Trade: A Reality Check," that's worth checking out. Finally, you can access all of my blog posts about outsourcing -- if you've read through the Foreign Affairs essay, several of them will look familiar.

Otherwise, here are the most in-depth treatments of the subject that I've seen:

International Data Corporation, Offshore Services: The Impact of Global Sourcing on the U.S. IT Services Market, November 2003.

Catherine Mann, “Globalization of IT Services and White Collar Jobs: The Next Wave of Productivity Growth,” Institute for International Economics Policy Brief 03-11, Washington, DC, December 2003

Jacob F. Kirkegaard, “Outsourcing – Stains on the White Collar?” Institute for International Economics working paper, January 2004

McKinsey Global Institute, “Offshoring: Is It a Win-Win Game?” San Francisco, CA, August 2003

Rafiq Dossani and Martin Kenney, “Went for Cost, Stayed for Quality?: Moving the Back Office to India,” working paper, Stanford University Asia/Pacific Research Center, November 2003

Ashok Bardham and Cynthia Kroll, “The New Wave of Outsourcing,” Fisher Center for Real Estate and Urban Economics, University of California At Berkeley, November 2003

Erica Groshen and Simon Potter, “Has Structural Change Contributed to a Jobless Recovery?Current Issues in Economics and Finance 9 (August 2003): 1-7

Jyotti Thottam, "Is Your Job Going Abroad?" Time, 22 February 2004.

Gene Grossman and Elhanen Helpman, "Outsourcing in a Global Economy," NBER Working Paper No. w8728, January 2002.

Daniel Pink, “The New Face of the Silicon Age,” Wired, February 2004

General references on globalization and the U.S. economy:

Douglas Irwin, Free Trade Under Fire (Princeton: Princeton University Press, 2002).

Raghuram Rajan and Luigi Zingales, Saving Capitalism from the Capitalists (New York: Crown Business, 2003).

Kenneth Dam, The Rules of the Global Game: A New Look at U.S. International Economic Policymaking (Chicago: University of Chicago Press, 2001).

Kenneth Scheve and Matthew Slaughter, Globalization and the Perceptions of American Workers (Washington: Institute for International Economics, 2001).

posted by Dan on 03.12.04 at 03:59 PM