tag:blogger.com,1999:blog-5043138489010794057.post1953911539684730298..comments2024-03-27T15:57:09.192+05:30Comments on Urbanomics: Saving capitalism from capitalistsUrbanomicshttp://www.blogger.com/profile/16956198290294771298noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-5043138489010794057.post-33659308334020796982012-01-04T02:00:33.193+05:302012-01-04T02:00:33.193+05:30Dear Gulzar,
In this context I found this intervi...Dear Gulzar,<br /><br />In this context I found this interview with Dalia Marin, who Chair in International Economics at the University of Munich - on outsoucing / wage differentials / and CEO pay - on "new new" trade theory<br /><br />http://www.nakedcapitalism.com/2011/08/dalia-marin-on-outsourcing-income-inequality-ceo-pay.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+NakedCapitalism+%28naked+capitalism%29<br /><br />regards, KP.KPhttps://www.blogger.com/profile/06553866275918658507noreply@blogger.comtag:blogger.com,1999:blog-5043138489010794057.post-44802202295050404732012-01-04T01:27:52.463+05:302012-01-04T01:27:52.463+05:30Dear Gulzar,
This deposition by Alan Greenspan an...Dear Gulzar,<br /><br />This deposition by Alan Greenspan and the question from the Democratic Rep Sanders summarizes the issue.<br /><br />http://www.youtube.com/watch?v=nBnKh6B2cMw<br /><br />On this<br /><br />""Ultimately, trade in a particular good is beneficial to a country only if <br /><br />1. the labour market and local business dislocation due to more competitive imports is offset by the combined positive effect of the consumer and producer surpluses from cheaper imports and the successful transition of the capital and labour dislocated to other more competitive and value-generating sectors. <br />2. the balance is achieved within a reasonably short period of time."" <br /><br />The consumer surplus is calculated per capita - and while that may assuage data points relating to nett surplus of the trade - the distribution effects have a whole host of problems.<br /><br />Since most growth in surplus is financialized the actual enervation of an economy is through the loss of jobs / capabilities / and the ecoystem of manufacturing that fosters innovation. The nett creation of jobs on a per capita basis cannot be expected to be equal.<br /><br />Some may argue that the nett creation of jobs as in the transition in the initial wave from manufacturing to services was greater - but through a simple extrapolation of this instance - all future transitions may not pan out likewise. <br /><br />Greenspans deposition ( not available) goes on to further elucidate that the "model predicts that the loss of jobs is compensated by the creation of higher value jobs" - and I am paraphrasing this from a recall of this extended exchange.<br /><br />However, abstract models do not have any responsibility to deliver according to an economists leap of faith ( offcourse supported by models) ... and maybe therein lies the rub.<br /><br />regards,KP.KPhttps://www.blogger.com/profile/06553866275918658507noreply@blogger.com