Economic globalization causes an increasing international fragmentation of value-added chains. A question often raised is whether such outsourcing affects domestic income distribution. The paper provides a theoretical treatment of this issue within a Heckscher-Ohlin framework. It extends beyond...

Will the incentives to pursue strategically motivated trade or industrial policies rise of rall if countries integrate? Economists have emphasized that one of the principal channels for welfare gains of Europe 1992 is a reduction of intra-European real trade coosts. This paper identifies the...

Economic globalization causes an increasing international fragmentation of value-added chains. A question often raised is whether such outsourcing affects domestic income distribution. The paper provides a theoretical treatment of this issue within a Heckscher-Ohlin framework. It extends beyond...