Services Outsourcing: Evaluating Changes in Revealed Comparative Advantage - the Case of the Us and India

36 Pages Posted: 7 Mar 2006

Date Written: February 18, 2006

Abstract

The structure of production and trade that exists in an economy can be taken to 'reveal' the current or recent past in terms of trends in comparative advantage. Traditionally the HO model characterizes the US as being rich in human capital which gives it a comparative advantage in services. India has also recently developed a comparative advantage in services outsourcing. As a result it appears that effectively in the future both India and US may actually be competitors in the production of services. This paper examines the issue of changing comparative equations for US and India as revealed by changes in the structure of production, employment and trade for the US and India. The two economies are characterized in terms of factor abundance on the basis of available empirical evidence.

Keywords: Outsourcing, Services, Comparative Advantage, US, India

JEL Classification: F11, F14

Suggested Citation

Dash, Shailey, Services Outsourcing: Evaluating Changes in Revealed Comparative Advantage - the Case of the Us and India (February 18, 2006). Available at SSRN: https://ssrn.com/abstract=887690 or http://dx.doi.org/10.2139/ssrn.887690

Shailey Dash (Contact Author)

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