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Diasporas and outsourcing : evidence from oDesk and India (English)

This paper examines the role of the Indian diaspora in the outsourcing of work to India. The data are taken from oDesk, the world's largest online platform for outsourced contracts. Despite oDesk minimizing many of the frictions that diaspora connections have traditionally overcome, diaspora connections still matter on oDesk, with ethnic Indians substantially more likely to choose a worker in India. This higher placement is the result of a greater likelihood of choosing India for the initial contract, due in large part to taste-based preferences, and substantial path dependence in location choices. The paper further examines wage and performance outcomes of outsourcing as a function of ethnic connections.


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    Kerr,William Robert, Ghani,Syed Ejaz, Stanton,Christopher Thomas

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    Policy Research Working Paper

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    South Asia,

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    Diasporas and outsourcing : evidence from oDesk and India

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    Poverty Reduction & Economic Management;Diaspora;initial contract;shares of contract;country of birth;trade in services;linear probability model;types of contract;foreign direct investment;international labor mobility;evidence of performance;pay and performance;human resource decisions;Innovation and Entrepreneurship;access to information;level of performance;firm size distribution;fixed effect;ethnic group;Labor Market;performance outcome;contract form;path dependency;standard error;diaspora network;indicator variable;economic exchange;web development;job opportunities;trade flow;online platform;job opportunity;wage effect;outsourcing work;public feedback;bargaining power;social network;advanced economy;cost advantage;performance effect;hourly wage;contract work;descriptive statistic;ethnic origin;sample mean;employment relationship;high wage;diaspora community;diaspora population;telephone line;online system;downward bias;diaspora measure;population level;sample period;migrant stock;positive value;Mobile Apps;transaction fee;Technology Diffusion;measurement error;contract opportunity;multiple sources;world market;knowledge flow;contract volumes;point estimate;indian population;gravity framework;weighted average;market condition;geographic location;trade literature;online consumer;previous work;diaspora effect;wage decline;administrative support;high-tech sector;market rate;electronic employment;competitive environment;average wage;computer terminal;billing system;source country;performance difference;empirical model;standard deviation;research purposes;international exchange;information problem;worker quality;individual company;banking facilities;future research;incremental innovation;cultural sensitivities;International Trade;hourly rate;cross-border financing;graphic design;skilled immigrant;Technology Transfer;economic integration;legal regulation;foreign location;instant access;knowledge diffusion;monitor performance;contract duration;analytical techniques;language skill;emerging economy;Emerging economies;referral service;job description;good performance;alternative route;information asymmetry;robustness check;total sample;performance metrics;log wage;search result;wage determination;experienced worker;relative magnitude;indian context;path dependence;immigration status;population census;labor service;business model;financial crisis;upper bind;unique visit;internet traffic;learning process;experimental study;inexperienced worker;outsourcing decision;open access;individual account;development policy;independent variable;performance rating;job applicants;start-up company;



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Kerr,William Robert Ghani,Syed Ejaz Stanton,Christopher Thomas

Diasporas and outsourcing : evidence from oDesk and India (English). Policy Research working paper ; no. WPS 6403 Washington, D.C. : World Bank Group.