While new cross-country time-series evidence suggests that technological change has contributed to a rise in earnings inequality, the choice of specification matters for the significance and size of the effect and also for where in the earnings distribution the impact is most pronounced (see Box 1, Table 1 and OECD, 201 la). Early empirical studies were based on the Stolper-Samuelson theorem, which predicts that trade increases the real return for the factor with which a country is most abundantly endowed. However, the theorem proved to be inconsistent with the evidence and in particular, the observed rise in inequality in low-income countries (e.g. Goldberg and Pavcnik, 2007, Feenstra, 2008, Stone and Cavazos, 2011).