Do Trade Agreements Kill Jobs?

By Steve Denning – Economists at the liberal-leaning Economic Policy Institute have long pointed to the negative effects of free trade, with massive loss of jobs to Mexico and China.

Yet conservative-leaning economists have questioned this interpretation of the evidence. Now some mainstream economists are beginning to agree that there is a problem.

The report shows how it happened.

“The basic narrative begins in the late 1970s and the 1980s. Through globalization, it became possible and attractive for firms to do business in, to, and from far more countries. Changes in corporate governance and compensation caused U.S. managers to adopt an approach to management that focused attention on the stock price and short-term performance.”

As a result, “firms invested less in shared resources such as pools of skilled labor, supplier networks, an educated populace, and the physical and technical infrastructure on which U.S. competitiveness ultimately depends.”

Gary Pisano and Willy Shih [2] have a frighteningly long list of industries that are “already lost” to the USA:

“Fabless chips”; compact fluorescent lighting; LCDs for monitors, TVs and handheld devices like mobile phones; electrophoretic displays; lithium ion, lithium polymer and NiMH batteries; advanced rechargeable batteries for hybrid vehicles; crystalline and polycrystalline silicon solar cells, inverters and power semiconductors for solar panels; desktop, notebook and netbook PCs; low-end servers; hard-disk drives; consumer networking gear such as routers, access points, and home set-top boxes; advanced composite used in sporting goods and other consumer gear; advanced ceramics and integrated circuit packaging.”

Their list of industries “at risk” is even longer and more worrisome. more>

One response to “Do Trade Agreements Kill Jobs?

  1. Pingback: ‘Make in India’ tagline is better – Kerala Business Network

Leave a Reply

Your email address will not be published. Required fields are marked *