WIIW The Vienna Institute for International Economic Studies - Wiener Institut für Internationale Wirtschaftsvergleiche

This paper analyses the impact of offshoring in the EU – both in total and differentiated by destination region (advanced Europe, developing Europe, developed non-Europe, developing non-Europe) – on six different non-wage working conditions: physical environment, work intensity, worktime quality, social environment, skills and discretion, and prospects. Results from instrumental variable (IV) estimations show that offshoring has substantial causal effects, improving the physical environment and career prospects, but also worsening the social environment, particularly in old EU member states. Moreover, the effects vary by destination: offshoring to advanced Europe improves skills and discretion but can increase work intensity, whereas offshoring to developing Europe enhances the physical environment and career prospects. Effects for non-European destinations are more heterogeneous and sometimes opposite to those observed in Europe.