Does the offshoring of production degrade or enhance the innovative capabilities of manufacturing firms? We contribute … products to China. We find causal evidence that offshoring impacts both the level and nature of innovation. In the technologies … evidence of a second-order positive effect of offshoring on the levels of innovation--particularly product innovation--in other …

integration of commodity markets (i.e., free trade) and international integration of factor markets (i.e., offshoring). In a two …-country, two-good, two-factor model we show that free trade and offshoring have opposite effects on rich-country workers. Free … trade hurts rich-country workers, while reducing the volatility of their wages; by contrast, offshoring benefits them, while …