Delocalization and Employment: Erroneous Debates and Real Challenges

By Jean-Pierre Chanteau

Since 1993, the threat of industrial delocalization has hung over the economic policy debate in France. This paper aims to show that this constraint has been overstated because delocalization threats were not well-defined and were often confused with other events (including FDI and international sub-contracting) linked to the multi-nationalization of corporations. Moreover, competition from low-wage countries was mainly analyzed within the framework of classical international trade theories. The paper concludes that the threat of delocalization is used to impose wage austerity measures and that institutionalist and evolutionary approaches are theoretically relevant in international economics.


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