Offshoring, Economic Insecurity, and the Demand for Social Insurance

Abstract

The fear of offshoring, particularly in services since 2000, has raised workers economic insecurity and heightened concerns over future economic globalization. Many have argued that globalization has exacerbated labor market turbulence increasing the demand for social insurance programs. The authors present a simple theoretical model establishing a connection between the threat of offshoring, economic insecurity, and the demand for social insurance. Data from the 1972-2006 General Social Survey to provides supporting empirical evidence.

Keywords: economic insecurity, offshoring, social insurance, trade adjustment assistance

JEL Classification: F16, J31, J65