Related Web
Links – Module 4 - Comparative Advantage and Trade |
When looking at the issue of trade and comparative
advantage, a wealth of information can be found with the Department of
Commerce. |
Go to: http://www.commerce.gov/ |
When looking at the global economy, an excellent
place to start is with the CIA Factbook. The Factbook provides many details about the economic,
political, and demographic characteristics of each country in the world. |
Go to: https://www.cia.gov/library/publications/the-world-factbook/index.html |
The United Nations Human Development Report (HDR)
looks at long-term trends in changes in wealth and income across the world’s
nations and trends within countries. In the past, the report has concluded that
global income inequality has increased over time with the major benefits of
trade and development going to the wealthy countries. |
Go to: http://hdr.undp.org/ |
It is a good idea to complement the U.N source with a critical
evaluation by
Columbia
University professor
Xavier Sala-i-Martin who finds fault with the HDR’s
methodology and conclusions. Martin finds that when using each person as an
observation (rather than a country), global income is converging for the
majority of the world’s people. |
Go to: http://www.columbia.edu/~xs23/papers/worldistribution/Economist%20March%202004.htm |
Comparative advantage is determined by a
significant number of factors. Labor wages are important, but so are the skills
and education of the workers, the nation’s infrastructure, and associated costs
of hiring workers such as the presence of a nation health care system. |
As the only industrialized country in the world
without universal health care offered to all of its citizens, firms that
produce in the United States must pick up part or all of the cost of health
care coverage for their employees (if it is offered). In the past decades,
health care costs have risen much faster than the inflation rate and now firms
include health care costs as part of the decision as to where production is
located. Krugman considers the importance of these issues for
Toyota in this New York Times article: |
Go to: http://www.pkarchive.org/column/072505.html |