Location: Halstead, Kansas, United States

This is my seventh year at Halstead which is also where I live with my wife and my soon to be two year old daughter.

Friday, August 25, 2006

Uh-Oh... Somebody was Wrong

In an two year battle royale the art teacher and me have have been arguing over outsourcing. I am a straight up fan of it and as a stockholder I expect my BODs to act in a legal and ethical manner that provides dividends and increases in the stock prices. I have know economic, moral or ethical problems with outsourcing. Our art teacher sees it as one of the greatest evils in the nation. Now I have more evidence that his view might be more emotional instead of economic:

Taking a swing at conventional wisdom, Princeton professors Gene Grossman and Esteban Rossi-Hansberg argued that wages for the least-skilled blue collar jobs had been rising since 1997 as outsourcing boosted productivity.

The professors presented their paper on Friday at the Kansas City Federal Reserve conference in Jackson Hole, Wyoming. The meeting's theme, "The New Economic Geography," comes at a time when some fear that the United States is becoming trapped in a wages-prices spiral to the bottom by cheap labor in India and China.

The Princeton economists contend that many observers tended to gloss over the productivity benefits involved in the offshoring of labor.

They presented evidence that the productivity effect had helped raise real wages for the least skilled among U.S. blue collar workers -- those who do jobs most likely to be shipped overseas -- by about a quarter of a percent per year between 1997 and 2004.

So is outsourcing good?

PS Kyle you should appreciate this too!


Anonymous RYaN SpENcE said...

I agree that outsourcing is good. Some aspects are more controversial and some not. I think its great because w/o it, mexico and china would have no jobs and immigration would probably go up because the loss of jobs. IDK but it sounds good to me!!!

7:50 PM  

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