New Outsourcing, Demand Uncertainty and Labor Usage

Sasan Bakhtiari; Robert Breunig

doi:10.1007/s11151-016-9529-9

New Outsourcing, Demand Uncertainty and Labor Usage

Sasan Bakhtiari, Robert Breunig^*

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

1 Citation (Scopus)

Abstract

We examine the decisions by small and medium-sized Australian firms to undertake new outsourcing. We hypothesize that new outsourcing may be related to demand uncertainty. We test this hypothesis at the firm level, making use of unique longitudinal data on Australian manufacturing. We find an asymmetric relationship between new outsourcing and demand uncertainty. For the larger firms in our sample, positive demand shocks are related to more new outsourcing. For all firms, negative demand shocks are related to less new outsourcing. New outsourcing appears to be related to demand uncertainty and to the firm’s overall approach to labor utilization.

Original language	English
Pages (from-to)	69-90
Number of pages	22
Journal	Review of Industrial Organization
Volume	50
Issue number	1
DOIs	https://doi.org/10.1007/s11151-016-9529-9
Publication status	Published - 1 Feb 2017

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title = "New Outsourcing, Demand Uncertainty and Labor Usage",

abstract = "We examine the decisions by small and medium-sized Australian firms to undertake new outsourcing. We hypothesize that new outsourcing may be related to demand uncertainty. We test this hypothesis at the firm level, making use of unique longitudinal data on Australian manufacturing. We find an asymmetric relationship between new outsourcing and demand uncertainty. For the larger firms in our sample, positive demand shocks are related to more new outsourcing. For all firms, negative demand shocks are related to less new outsourcing. New outsourcing appears to be related to demand uncertainty and to the firm{\textquoteright}s overall approach to labor utilization.",

keywords = "Business strategy, Demand uncertainty, Labor adjustment, Outsourcing",

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New Outsourcing, Demand Uncertainty and Labor Usage

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