First, GVC participation helps explain only a small part of the variation in wage inequality across the sample, implying that there are other more important determinants of wage inequality. Second, the employment reallocation effects arising from enhanced participation in GVCs are not directly captured (since the dependent variable is wage inequality).7 Nevertheless, the results hold when using the more holistic OECD inequality measures which do account for incomes of the unemployed. For example, somewhat different evolutions can be perceived depending on whether the analysis uses measures of inequality derived from, WIOD, the University of Texas Inequality Project, the World Development Indicators, or the OECD inequality indicators. They suggest that offshoring can give rise to a positive productivity shock which ultimately benefits the type of workers whose tasks have been offshored. The intuition is that offshoring is tantamount to “labour-augmenting technological change” or in other words it acts like technical progress which increases the productivity of the labour whose task has been offshored.