Jones and Kierzkowski (1990), in a non-theoretical paper, allude to a similar effect. They argue that offshoring, which is also akin to technological progress, can lead to instances where workers whose jobs have relocated offshore rise as is predicted in Grossman and Rossi-Hansberg (2008). The productivity effect occurs not so much because of the additional units of unskilled labour that can be offshored in reaction to falling offshoring costs (second order effect) but because of the costs savings associated with the part of the low-skilled tasks that had already been offshored before (first order effect). The productivity effect would then be large when the extent of offshoring is already large. The labour supply effect would be large when the share of skilled labour in total costs is large and when high-skill tasks substitute poorly for low-skill tasks in the production process.