| 英文摘要 |
In this paper, I present a simple North-South model to show that international outsourcing trade, on one hand, decreases product varieties (generated by the South) but increases product varieties (generated by the North) on the other hand. However, the latter dominates the former. As a result, in a world of a mixture of intra-industry and international outsourcing trade, welfare improves with an increase in real wage rates and total product varieties available to consumers. Furthermore, this model also implies that the South’s technology catch-up is a driving force for welfare improvement, leading to a greater diversity of consumption and a higher real wage in both the North and South. |
