, first advanced by Raymond Vernon:
When a product is first invented, the major demand is mostly in high-income countries, and the product still must be perfected by using additional R&D and local production.
Over time, the product and its production technology become more standardized and familiar. Factor intensity in production tends to shift away from skilled labor toward less skilled labor.
The technology diffuses and production locations shift into other countries, eventually into developing countries with abundant less-skilled workers.