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Computerization, offshoring and trade: The effect on developing countries

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  • Hidalgo, Camila
  • Micco, Alejandro

Abstract

(Antràs, 2020) argues that whereas in the 1990s it was profitable to fragment production processes, now computerization allows the automation of human tasks, reduces labor costs, and substitutes the offshoring of certain activities. We analyze imports from six developed countries sourced from developing countries to study this hypothesis. We find a decline in imports of products from sectors characterized by low wages and routine tasks, therefore at risk of automation. Moreover, imports rose within sectors known for having a significant potential for offshoring until 2001, followed by a subsequent decline. Labor-replacing tasks technologies are changing the comparative advantages of developing economies.

Suggested Citation

  • Hidalgo, Camila & Micco, Alejandro, 2024. "Computerization, offshoring and trade: The effect on developing countries," World Development, Elsevier, vol. 180(C).
    • Handle: RePEc:eee:wdevel:v:180:y:2024:i:c:s0305750x24000871
    DOI: 10.1016/j.worlddev.2024.106617
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