incorporating production offshoring into a North-South model of directed technical change. We �find that if offshoring is present … change in the North. This fi�nding highlights the different implications of offshoring and conventional trade on innovation …. Furthermore, we �find that an increase in the Southern stock of capital reduces offshoring and also leads to skill …

In this study, we predict a pattern of offshoring and reshoring over the course of economic development. We achieve … this, by extending Grossman and Rossi-Hansberg's (2008) model of offshoring in a simple way by assuming that offshoring … country has two opposing effects on offshoring. On the one hand, it increases the wage rate of workers rendering offshoring …