ABSTRACT
In twenty-first century capitalism, production of goods and services is increasingly organized internationally, within networks of production typically governed by lead firms. The question of the social consequences of offshore outsourcing (herein offshoring) has become one of the central issues of our day. How these consequences are understood, however, depends on the theoretical perspective adopted. In the title of their often-cited paper, Grossman and Rossi-Hansberg (2006a) write ‘it’s not wine for cloth anymore’, signaling that Ricardo’s trade model is no longer relevant.
