The debate among Serious Economists about the benefits of free trade continues, and Dani Rodrik continues to take a dispassionate look at the data and the models. This post, although a bit geeky, is intriguing because Rodrik dissects an analysis cited by Bernanke in a recent speech, which found that the benefits of free trade […]
Read more...Readers may have taken note about the robust debate among Serious Economists about free trade, provoked in large measure by Harvard economist Dani Rodrik holding some of his peers’ feet to the fire (note that Rodrik is not anti-free trade, but anti sloppy or dumbed down justifications). One continuing bone of contention between economists and […]
Read more...Many economists have observed that the current global imbalances, meaning US trade deficits financed by overseas capital flows, cannot continue forever. Indeed, there are already signs that foreign central banks are getting uncomfortable with their level of US dollar holdings and have said they plan to diversify their currency holdings (translation: sell dollars) which would […]
Read more...According Robert Cringely at PBS, IBM is cutting at least 150,000 US jobs in its Global Services Division, and each US worker is to be replaced by a new overseas hire. This headcount cut, called Project Lean, bears out the populist view that corporate executives are greedy and outsourcing damages the American economy. As we […]
Read more...Dani Rodrik, if he thought it wasn’t beneath him, deserves an op-ed column at a well respected paper. He has managed to foment a good deal of lively debate among Serious Economists (the blogs involved include his, Brad DeLong’s, Mark Thoma’s, and Greg Mankiw’s) on the question of trade economics. For the most part, Dani […]
Read more...Yesterday, our post “Costly Trade with China,” cited a study by the same name by the Economic Policy Institute which estimated the jobs lost to trade with China between 1997 and 2006 at 2.1 million. I wondered whether anyone had done the calculus as to what the offsets to these job losses might be, and […]
Read more...Interestingly, after a some robust debate among Serious Economists at Mark Thoma’s blog, Economist’s View, on the merits of trade (even Krugman contributed via e-mail), a study taking the opposite view appears at Economic Policy Institute. The study argues that millions of jobs have been lost to China. Its methodology looks reasonable. Mark Thoma was […]
Read more...Martin Wolf, the Financial Times’ lead economics commentator, in today’s piece, “Risks and rewards of the world economy’s golden era,” ponders our current prosperity and what might upset it. He highlights the risks of unforeseen shocks and backlash against globalization. The comments about shocks are somewhat novel; the ones on political backlash are more familiar. […]
Read more...The debate among some serious academics on the economic models, their merits, and what they say about who might win or lose from trade continued over the weekend. While informative, it was also oriented heavily towards theory. Dani Rodrik tries to sum up: Can we all agree on these? 1.Trade policy works through its effect […]
Read more...Yesterday, we featured a post from Dani Rodrik which observed that free trade doesn’t necessarily lower prices (it will lower prices of imports and increase prices of exports, so it depends on the mix of goods purchased). What is interesting about the debate that unfolded is that it tells us something not just about free […]
Read more...This is a nice post from Dani Rodrik. The short answer is it depends. Free trade increases the price of export goods and lowers the price of imports: [A]nyone who understands comparative advantage knows that free trade affects relative prices, not the price level (the latter being the province of macro and monetary factors). When […]
Read more...A provocative article by Jeff Faux at the Economic Policy Institute argues that US trade deficits have become so large and so chronic that we need to put the brakes on further trade liberalization until we get our house in order. And getting our house in order means increasing our domestic savings rate. For those […]
Read more...We got this map from Tyler Cowen’s Marginal Revolution, which in turn cites Kottke. In case you had any doubts as to who was the leading outlet for China, Inc., now you know (although some question the methodology, based on my discussions with people who have knowledge of Wal-Mart’s buying practices, I have no doubt […]
Read more...William Greider was early to question whether free trade delivers the benefits its proponents assert it does (we pointed to his 2005 New York Times op-ed piece, “America’s Truth Deficit,” in which he described our prevailing regime as managed trade rather than free trade, and observed that most of our trading partners were playing the […]
Read more...Brad Setser, who is normally an upbeat counterpoint to permabear Nouriel Roubini at RGE Monitor has an unusually worried post on what the end game might look like for foreign purchases of the US dollar (the central element of the oft-discussed global imbalances). We found this post courtesy Brad DeLong. Setser focuses in on a […]
Read more...