Outsourcing is once again in the news, including this attention-grabbing headline: “Developer outsources job to China so he can watch cat videos.”
That’s a pretty self explanatory, though misleading, characterization, I’d say. It seems he’s outsourcing his job because he can reduce his own personal costs significantly without a detectable decrease in quality. That’s efficiency enhancing, no?
Further evidence to support my conjecture comes near the end of the article:
The kicker: Further digging found that Bob was taking jobs with other firms and outsourcing that work to China too. “It looked like he earned several hundred thousand dollars a year, and only had to pay the Chinese consulting firm about fifty grand annually,” said Verizon.
All this seems to suggest that there is no world equilibrium wage in the software industry right now.