The word fragmentation refers to a splitting up of a vertically integrated production process such that the separate fragments can be traded on markets. This paper is concerned with international fragmentation, generally allowing gains from a finer division of labor based on comparative...

Economic activity sometimes brings advanced technology to an enclave in a less-developed region where low-wage labor can be combined with skilled labor and capital from the advanced region to produce commodities for export to world markets. Potential skills of local workers may not be known to...