Search Results
Working Paper
Firm boundaries and buyer-supplier match in market transaction: IT system procurement of U.S. credit unions
By examining IT system procurement between U.S. Credit Unions (CUs) and IT vendors, we present descriptive analyses showing that firms? outsourcing decisions might be interrelated to each other through suppliers? market entry decisions. The buyer-supplier match in the market might also play an important role in determining firms? boundaries. We also argue that market thickness along the product space might determine the characteristics of input that is procured through the market.
Newsletter
Why do firms use temporary workers?
This article explores the pros and cons of using temporary workers and their permanent counterparts. It examines firms? various motivations for using temporary employment, accounting for geographical and industry differences.
Working Paper
Spatial organization of firms
A firm?s production activities are often supported by non-production activities. Among these activities are administrative units including headquarters, which process information both within and between firms. Often firms physically separate such administrative units from their production activities and create stand alone Central Administrative Offices (CAO). However, having its activities in multiple locations potentially imposes significant internal firm face-to-face communication costs. What types of firms are more likely to separate out such functions? If firms do separate administration ...
Working Paper
Outsourcing business services and the role of central administrative offices
In this paper, I study whether there is any evidence that the market scale surrounding a central administrative office (CAO), which includes corporate headquarters, influences a firm's cost-effectiveness in procuring business services. By linking plant-level data from the 1992 Annual Survey of Manufactures with CAO information from the Survey of Auxiliary Establishments, I examine manufacturing plants' practice of outsourcing services in relation to the size of the local service market surrounding the plant and that surrounding the plant's CAO. I found statistically significant evidence that ...
Working Paper
Supplier switching and outsourcing
We examine supplier switching decisions using a unique database that tracks firms (credit unions) and their suppliers (data processing vendors); the data are in a panel, allowing us to track supplier switching decisions at a new level of detail. We focus on two sets of relationships. First, we estimate a model that relates supplier choices and switching to a variety of buyer- and supplier-specific characteristics. Second, we examine how> switching depends on the vendor relationships that credit unions choose: one is a partial form of outsourcing while the other is more complete. This allows ...
Journal Article
Who are temporary nurses?
Using data from the National Sample Survey of Registered Nurses, the authors compare the characteristics of temporary and permanent registered nurses. They compare their findings for the nursing profession with characteristics of temporary and permanent workers in other occupations. They also look at the role of geography in a registered nurse?s decision to become a temporary worker.
Newsletter
The changing relationship between headquarters and cities
A recent Chicago Fed conference looked at the shifting geography of company headquarters, with a public policy focus on headquarters as a much-desired target of economic development efforts.
Journal Article
Professional employer organizations: What are they, who uses them, and why should we care?
Using both public and confidential data, the authors summarize how the intensity of use of professional employer organization (PEO) services varies across industries and geographical areas. Their analyses using microdata of manufacturing establishments suggest that the use of PEO services depends on the size of the establishment and of its parent firm. The use of PEO services is greater for newly constructed establishments, as well as for establishments with a potentially high injury and illness rate. Greater diversification across industries and geographical areas of a parent firm may also ...
Journal Article
Outsourcing, firm size, and product complexity: evidence from credit unions
Outsourcing business services is a key concern in the modern economy. Focusing on data processing services for credit unions from 1994 to 2003, the authors find that both credit union size and the diversity of their product offerings influence the propensity to outsource. The results suggest that simple scale-economy-based explanations for outsourcing may be inadequate.
Working Paper
Outsourcing business service and the scope of local markets
This paper examines outsourcing to test whether productivity-enhancing specialization is facilitated in bigger cities. First, the paper provides a theoretical model which shows that greater local demand for a given input promotes the entry of suppliers into a city; the increased number of suppliers then results in lower outsourcing prices and a higher use of outsourcing by final producers, therefore reducing the final producers' production costs. I then test the predictions of the model by examining manufacturing plants' practices of outsourcing business services, by using plant-level data ...