We set up a general equilibrium model, in which offshoring to a low-wage country can lead to job polarisation in the … pay wages that are positively linked to their profits by a rent-sharing mechanism. Offshoring involves fixed and task … variable offshoring costs. A reduction in those variable costs increases offshoring at the intensive and at the extensive …

We revisit Grossman and Rossi-Hansberg's (2008) famous result, that under certain conditions offshoring of low … Rybczynski-type reallocation of factors to absorb offshoring-induced job displacement is ruled out. We allow for simultaneous … offshoring of both skilled and unskilled labor, and we derive new results on the role of factor-bias in offshoring, identifying …