Classical and Neoclassical Theories of Offshore Outsourcing

Deborah WinklerWilliam Milberg
Written By SCEPA

WORKING PAPER

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This paper compares neoclassical and classical theories of outsourcing.

The former is premised on an improved international division of labor and predicts a rise in the return to skill. This contrasts with the classical model, which emphasizes the distribution of income between labor and capital and its implications for investment and economic growth. But the classical model needs amendment in the contemporary world.

SCEPA
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