Offshoring of American Jobs

From Alvin Hansen Symposium on Public Policy at Harvard University

Offshoring of American Jobs

What Response from U.S. Economic Policy?

By Jagdish N. Bhagwati and Alan S. Blinder

Edited by Benjamin M. Friedman

Two leading economists discuss a range of issues relating to the “offshoring” of American jobs, from free trade to unemployment levels.

Overview

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Summary

Two leading economists discuss a range of issues relating to the “offshoring” of American jobs, from free trade to unemployment levels.

It is no surprise that many fearful American workers see the call center operator in Bangalore or the factory worker in Guangzhou as a threat to their jobs. The emergence of China and India (along with other, smaller developing countries) as economic powers has doubled the supply of labor to the integrated world economy. Economic theory suggests that such a dramatic increase in the supply of labor without an accompanying increase in the supply of capital is likely to exert downward pressure on wages for workers already in the integrated world economy, and wages for most workers in the United States have indeed stagnated or declined. In this book, leading economists Jagdish Bhagwati and Alan S. Blinder offer their perspectives on how the outsourcing of labor and the shifting of jobs to lower-wage countries affect the U.S. economy and what, if any, policy responses are required. Bhagwati, in his colorful and pithy style, focuses on globalization and free trade, while Blinder, erudite and witty, addresses the significance of labor market adjustment caused by trade. Bhagwati's and Blinder's contributions are followed by comments from economists Richard Freedman, Douglas A. Irwin, Lori G. Kletzer, and Robert Z. Lawrence. Bhagwati and Blinder then respond separately to the issues raised. Benjamin Friedman, who edited this volume (and organized the symposium that inspired it), provides an introduction.

Hardcover

$20.95 S ISBN: 9780262013321 160 pp. | 5.375 in x 8 in 1 figure

Editors

Benjamin M. Friedman

Benjamin M. Friedman is William Joseph Maier Professor of Political Economy at Harvard University and the author of The Moral Consequences of Economic Growth.

Endorsements

  • A provocative, entertaining, and high-level discussion of offshoring and its consequences. The debate between Bhagwati and Blinder—and the comments of a distinguished set of panel members—will bring the reader to the frontier of thinking on one of the most important policy issues of our time.

    Robert W. Staiger

    Department of Economics, Stanford University

  • This outstanding volume provides an exceptional contribution to the debate on offshoring. The two main writers, Jagdish Bhagwati and Alan Blinder are both world-class economists who combine clear and original arguments and deep insights on the subject. It will become a classic and is a must-read for policymakers, economists, scholars or anyone who is interested in this important global phenomenon.

    K.C. Fung

    Department of Economics, University of California, Santa Cruz

  • Outsourcing has become synonymous to losses of jobs and income in the US popular debate. But the views on outsourcing among academic economists are much more diverse. Reflecting this divide, this book provides an entertaining discussion, conducted by distinguished economists, of the likely effects of outsourcing in the years to come.

    Henrik Horn

    Professor of International Economics, Senior Research Fellow, Research Institute of Industrial Economics (IFN), Stockholm