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This paper develops an endogenous growth model based on a Roy-like assignment model in which heterogeneous workers endogenously sort into different technologies/tasks according to their comparative advantage. By modeling explicit distinction between worker skills and tasks as well as incorporating task-specific technologies, we analyze in depth the technology-skill-growth and offshoring-growth links that are absent in traditional models of endogenous growth. We show that offshoring increases domestic aggregate productivity, welfare and growth due to technology-upgrading mechanism.

Technology, skill, and growth in a global economy