Outsourcing Gone Wild...

Well, it's nice to know in 10 pages worth of posts you found 4 words you could argue. Don't break your arm patting your own back.

 

Argue? One just noted that the comment made was ridiculous. Providing a means to refer directly to trade analysis was a bonus

 

Comparative advantage is not what is going on, and has nothing to do with outsourcing. You know this. You keep flooding this thread with economic jargon that is nothing more than pretend justification. Comparative advantage is about companies doing what they can best, based upon the geography of their regions, their national resources and climates. It has nothing to do with global conglomerates hand picking who can supply the cheapest labor.

 

Comparative advantage is always "going on". It refers to opportunity costs after all. Using it within a context of outsourcing is also straight forward. To suggest a flaw in the approach you're going to have to go for something high powered (such as the analysis into organisational knowledge)

I keep making remarks that are valid. You may not like that of course. That wouldn't be surprising as economic nationalism is just repackaged mercantilism after all.

This isn't as silly as your "Ricardo invented free trade', but it comes close. You're effectively mixing up absolute advantage and comparative advantage here.

 

LMAO. Outsourcing is absolute advantage, not comparative advantage. You do realize all it will take is for anyone reading to spend 5 minutes looking up what they mean to see you're full of (*)(*)(*)(*)?

 

You show your ignorance of basic trade analysis again. Absolute advantage only provides us with an understanding of productivity differences. It doesn't provide us with an understanding, for example, of how prices of factors of production differ.

I'd love to see folk do some reading. By definition, reading leads to laughter at the economic nationalist's position

 

Well, you just might get what you wish for. Since the majority have been hurt by your "altruism", I expect a lot of reading by the masses from here on out. Your side has nothing. If people new the "great cost of goods" would be a jump of maybe 25% to bring the jobs home, everything for your side goes to hell. Tell me America, is it better to pay 100$ for new Nikes where foreigners make 12 dollars a day, or 125$ for new Nikes where Americans make 15 an hour starting and our economy is as vibrant as ever before, if not more so? This question is for people who care about America, not you Reiver.

 

Just the wonders of economic validity. You can rant as much a you want, but it won't impact on that slice of jolliness

 

Prove it. I have never seen a post of yours that supplied any sort of evidence or a source to back up your "theories". Every single one of your posts can be summed up with "the other side is dumb, trust me". Sorry, in this modern economic climate, trust doesn't exist.

 

Prove what? Heckscher-Ohlin? Dynamic comparative advantage? Well-being gains from trade? Losses from protectionism? Try and make some sense

 

Heckscher-Ohlin- http://www.princeton.edu/~ies/IES_Studies/S77.pdf

Dynamic Comparative Advantage

The ability of an agricultural system to compete without distorting government policies can be strengthened or eroded by changes in economic conditions. Dynamic comparative advantage refers to shifts in a system's competitiveness that occur over time because of changes in three categories of economic parameters-long-run world prices of tradable outputs and inputs, social opportunity costs of domestic factors of production (labor, capital, and land), and production technologies used in farming or marketing. Together, these three parameters determine social profitability and comparative advantage.

The appropriate world prices for measuring efficiency or comparative advantage are long-run equilibrium levels that approximate best guesses of expected future prices. If the country's decisions to buy or sell on world markets will not have any measurable effect on world price levels, those price levels can be considered exogenous and, once arrived at, can be taken as given for domestic agricultural systems. The world prices are the correct indicators of social valuation of tradable commodities even if a country's decisions to buy or sell internationally do affect the world price of a good. When a large country has market power, however, the analyst needs to take into account the impact of that country's trading decisions on world prices.

In the absence of knowledge of future prices, most analysts project constant long-run real prices rather than fluctuating prices. If new information results in changes in the constant price guess or in the projection of continually increasing or decreasing future prices, these changes can be incorporated easily into the PAM. Separate PAMs can be constructed for each year, and each can have different assumed world prices.

Costs of factor services in any country can be expected to change over time. But cyclical variations in the real wage and the real return to capital, associated with swings in macroeconomic policy, are not the primary focus of the PAM method. Instead, interest centers on long-run trends in the costs of labor, capital, and land. As economies grow, real wages typically rise, both in absolute terms and relative to real costs of capital and land. For agricultural systems, changes in the social opportunity costs of labor and of capital depend on changes in the national environment for investment and growth. Land rental rates are endogenous to agriculture but will be constrained by changes in world prices and in real wage and interest rates, because payments to land and other permanently fixed factors come out of profits. Analysis of projected comparative advantage therefore includes both the future pressures that changing real factor prices might exert on agricultural systems and the influences of likely world prices for tradable outputs and inputs. The results identify systems that can readily expand and those that will have to contract or change in order to survive.

Changes over time in factor and commodity prices can also influence agricultural technologies. Farmers and researchers innovate, often by finding new ways of using less of factors that are relatively expensive (usually labor) and more of other inputs. Successful technological change permits commodities to be produced with reduced costs of one or more inputs. Empirical analysis of intra-system change can be done with partial budgeting, a technique in which individual cost-saving or revenue-increasing changes can be analyzed within the PAM for the initial system.

Notice to all reading, all of these are new theories, I stress THEORIES, should not be misconstrued as science, and all depend on zero loyalty to one's national market and treating all workers as if they were a commodity like corn.

 

Don't bottle out now! What aspect of trade analysis do you need evidence on? HEckscher-Ohlin? Perhaps some discussion of the Leontief Paradox?

 

Also to those reading, notice Reiver uses "dynamic comparative advantage" as proof after "comparative advantage" as an excuse for free trade has been destroyed. "Dynamic comparative advantage" applies to agriculture, and once again he simply pulls economic jargon out of his hat to try and look like free trade is the side of logic, banking on the fact none of you will research his tripe.

 

This is utter drivel. Static comparative advantage ignores the consequences of imperfect competition. The classic example is first mover advantages generated by the economies of time. Dynamic comparative advantage provides an understanding of how opportunity costs- and therefore specialisation- is related to time. Other than issues created by the economies of time, we also have analysis into innovation (which then allows for additional analysis into intra-industry trade)

 

Leontief paradox
The observation by Wassily Leontief that in spite of being the world's most capital-rich country, the US appeared on average to have exports that were slightly more labour-intensive than its imports. This was thought to be paradoxical because the Heckscher-Ohlin model of international trade led people to expect that US exports would be capital-intensive and its imports would be labour-intensive. Two possible explanations for the paradox are: first, that the simple Heckscher-Ohlin model ignored the role of natural resources in affecting trade; and second, that because of its large investments in human capital which gave it a highly skilled labour force, the effective US labour supply was much larger than the mere numbers of workers would suggest.

Thank you Reiver. If nothing else the Leontief paradox proves that these theories are not proven economic science, and "economists" are as easily susceptible to putting stats over humans, and not knowing what the end results of their "theories" impacting nations would be.

 

Static and Dynamic Comparative Advantage: A Multi-Period Analysis with Declining Terms of Trade: http://www.jstor.org/pss/4227305

first-mover advantage
Definition

A sometimes insurmountable advantage gained by the first significant company to move into a new market.
Information

It is important to note that the first-mover advantage refers to the first significant company to move into a market, not merely the first company. For example, Amazon.com may not have been the first seller of books online, but Amazon.com was the first significant company to make a entrance into the online book market.

First-mover advantage was initially touted as crucial in the Internet economy, although now there is a growing backlash against it. First-mover advantage can be instrumental in building market share, but this may or may not translate into business success.

Basically, being a first-mover only makes sense if the rewards justify the risks. Some industries reward first-movers with near-monopoly status and high margins. Other industries do not offer similar rewards, allowing late-movers the chance to compete more effectively and efficiently against early entrants.

Specialization (or specialisation) is the separation of tasks within a system. In capitalist societies, individual workers specialize for functions such as building construction or gasoline transport. In both cases, specialization enables the accomplishment of otherwise unattainable goals. It also reduces the ability of individuals to survive outside of the system containing all of the specialized components.

International trade is traditionally thought
to consist of each country exporting the goods
most suited to its factor endowment, technology,
and climate while importing the goods
least suited for its national characteristics. Such
trade is called inter-industry trade because
countries export and import the products of different
industries.<-----This most importantly shows Reiver's as being disingenuous as his use of comparative advantage. All of these theories and terms are based upon industries not outsourcing. Outsourcing has basically made all of these terms and theories moot.

 

Its great to see you actually refer to something relevant for a change. As you read, the likelihood of rejecting economic nationalism will increase. We just now need you to try something more up-to-date. Try this one

 

You do know that googling and then just copying and pasting isn't evidence of multi-tasking? Try reading what you find and try and compose an argument. For example, new trade theory (inspired by Krugman) typically attempts to use dynamic comparative advantage to understand trends in trade (e.g. product life cycle analysis, shifting the analysis to a consideration of intra and inter-industry trade as innovation shifts from product to production methods). I'd go further of course and note that the concept has significant effects for issues such as economic development. Thus, neo-liberalism becomes a harvester of absolute poverty

 

Any time "I" compose an argument, I get hit with "you have nothing to back it up but purely anecdotal evidence". No one will be convinced with us two arguing. It is far more appropriate for those to read for themselves and decide with their own brain which side is right. Then the cheap tactics of free trader's debating styles no longer apply. Just like "first mover advantage" has NOTHING to do with outsourcing the same as comparative advantage, it also has NOTHING to do with free trade in general. When someone figures out another is more than capable of lying, the rest of their words fall on deaf ears. Your words need to fall on deaf ears.

 

You're using copy and paste to avoid making an argument. That doesn't surprise as, when we get you to actually make comment, you set yourself up for a hefty fall: from "Ricardo invented free trade" to "Just like first mover advantage has NOTHING to do with outsourcing the same as comparative advantage, it also has NOTHING to do with free trade in general". The latter isn't just poorly written, it also again advertises that you're trying to make comment over trade without understanding anything about trade analysis.

 

Sorry, not "invented" but formalized the case for free trade. As for first mover advantage, it has NO baring on the protectionism verses free trade debate. It is simply putting a name on the force of the 1st major player in an industry, like Newton naming the obvious in "gravity". Just like being smug, arrogant, and/or dismissing the other side as ignorant has no baring.

 

Still not right! Destroyed the notion of trade as a zero sum game.

Repeating nonsense won't make it right all of a sudden. Once we refer to economies of time we change our understanding of the optimal result. We then have an understanding of how enforced liberalisation on a developing country can lead to a damaging result (such as over-reliance on resource exploitation).

 

1st mover advantage is not the 1st to arrive to exploit cheap labor. You act as if slave labor is an industry in itself, not the products they are producing. What is globalization, which you adamantly support, if not forced liberalization on developing countries at the expense of workers and tax payers of developed nations? Do you post just for the sake of posting?

 

You've gone off on one again! What we have is a distinction between static and dynamic comparative advantage. That distinction reflects economies of time. We therefore only have an argument for protectionism as part of an industrial policy designed to add economic development.

 

All the economic theories are based upon nations as if they don't exist, and workers as not humans with livelihoods. As long as economic theories are merely about numbers, they should never be considered the end all science for decision makers, but merely a reference.

Not to mention, all the theories are extremely elitist and anti-capitalist in nature, as they basically dictate "developed" countries have enough, treat industry as a set in stone aspect, not taking into account that industries die and are born again constantly, and "free trade" distorts this natural process in the developed world until the day the underdeveloped world catches up.