tag:blogger.com,1999:blog-5043138489010794057.post3053873561967226747..comments2024-03-27T15:57:09.192+05:30Comments on Urbanomics: Is free trade efficient and/or good?Urbanomicshttp://www.blogger.com/profile/16956198290294771298noreply@blogger.comBlogger3125tag:blogger.com,1999:blog-5043138489010794057.post-18469921265492141202011-02-27T11:21:51.580+05:302011-02-27T11:21:51.580+05:30Dear Gulzar,
Gains in a sense are expected to be ...Dear Gulzar,<br /><br />Gains in a sense are expected to be disproportionate ... but its concentration is the problem. If the world is treated as a system then the proportional number of gainers makes sense, (though even there the proportionality of the gain makes for serious imbalances) ... but since countries have narrower interests -this argument is hardly a consolation. <br /><br />http://motherjones.com/politics/2011/02/income-inequality-in-america-chart-graph<br /><br />And that is the US ... income disparity (better reflected by the gini) is a better indicator than only trading off the surplus ( GDP per capita) vs the DWL.<br /><br />While this comment in itself is not suggesting any approach to a remedy ... that workers are responsible for retraining themselves to better jobs .... and that such jobs exists - the evidence in this crisis is sketchy.<br /><br />regards,KP.KPhttps://www.blogger.com/profile/06553866275918658507noreply@blogger.comtag:blogger.com,1999:blog-5043138489010794057.post-55768802862067941242011-02-26T08:58:45.743+05:302011-02-26T08:58:45.743+05:30In an open economy, I wonder if the term 'lose...In an open economy, I wonder if the term 'losers' is justified. The losses in manufacturing jobs is due to relative loss in competetiveness and an inevitable consequence of free trade and the 'catching up' of developing countries in terms of capital formation. The US enterprises find the highest marginal returns on labor and investment occuring in high-tech, R&D, innovation etc. The long-run correction should likely elevate the skill levels of 'losers' or produce labor force in tune with market expectations given the right interventions by governments.<br /><br />In truly democratic nations like the US, the citizens as a whole are likely to benefit as a result of free trade. In sham democracies like India where corporate-political-bureaucratic nexus reigns supreme and where economic growth is not met with rising human capital levels across the spectrum, free trade and liberalization is likely to lead to heightened income inequalities. Such pervert governments further fool the people by offering 'safety-nets' like NREGA and food grain rationing.Sridharnoreply@blogger.comtag:blogger.com,1999:blog-5043138489010794057.post-50223014312228526122011-02-25T11:01:16.747+05:302011-02-25T11:01:16.747+05:30The entire difficulty is having the optimum safety...The entire difficulty is having the optimum safety net in place, funding it and not creating a perverse incentive system. <br /><br />A difficult challenge, but one to be necessarily faced.sai prasadnoreply@blogger.com