improvements in the informal sector expand both offshoring and outsourcing, and the developed nation wage must rise. When the …We present a model of offshoring of tasks to a developing nation, which is characterized by a minimum wage formal … informal sector. An improvement in the productivity in performing offshored tasks in the developing country raises offshoring …

Barriers to outsourcing that are being currently implemented in the US effectively tax its companies who "export" jobs … through outsourcing. The objective is to raise domestic employment. Given that many of the important international markets … oligopolistic context. We find that while an outsourcing tax favors domestic workers by causing firms to switch to a greater use of …