Published in:
The World Economy
We study the relationship between global value chain (GVC) participation, worker-level routine task intensity, and wage inequality within countries. Using survey data from 34 countries and instrumenting for GVC participation, we find that higher GVC participation is associated with more routine-intensive work, especially among workers in offshorable occupations. This indirectly widens within-country wage inequality. However, GVC participation directly contributes to reduced wage inequality, except in the richest countries. Overall, GVC participation is negatively associated with wage inequality in most low- and middle-income countries that receive offshored jobs, and positively in high-income countries that offshore jobs.