Container box loading by crane, Vessel boat in logistic Singapore port, transportation, delivery and business concept

Research Area

Global Division of Labor

Globalization has dramatically changed the way economies work. Trade, international investment, and migration, in conjunction with rapid technological progress, have led to an increasing international division of labor whereby production facilities are spread around the globe. This is commonly believed (certainly by many academic economists and policymakers) to promote growth in both developed and developing countries. Their credo is that international production and trade lead to a better provision of goods and services, greater global economic integration (especially through global supply chains), increase the scope for economic specialization, and may facilitate the participation of people in emerging and developing countries in global economic exchange. Yet, while greater international specialization is commonly viewed as raising economic prosperity, even those in favor of globalization would concede that it creates not only winners but losers as well—and also has unintended adverse side effects. Against this backdrop, the overall research objective of the Global Division of Labor Research Area is to empirically analyze key aspects of the international division of labor in the course of growing globalization and to develop answers to the challenges created by globalization. Research focuses on the determinants and effects of international trade, foreign direct investment, and international migration at the worldwide and regional levels. Publications produced by the Research Area show, for instance, that in the industrialized source countries trade- and FDI-induced offshoring favors high-skilled and non-routine jobs even over medium-skilled, while in the developing host countries, capital inflows raise corporate productivity via various transmission channels and diminish migration outflows of unskilled labor.

Journal Article

Attracting FDI in Middle-skilled Supply Chains

Economics: The Open-Access, Open-Assessment E-Journal
03/2018
Theodore Moran , Holger Görg , Adnan Šerić ...

While popular opinion often pictures FDI flowing in search of lowest-wage, lowest- skilled activities in emerging markets, actual FDI...

Dierk Herzer
Dr. Peter Nunnenkamp
Lucia Pérez-Villar
Prof. Horst Raff, Ph.D.