Meditations and Learnings

Meditations and Learnings

"Hollowing Out the Middle Class"

Americans often complain that too many manufacturing companies outsourced their jobs to China, and they catastrophise about the day the people in the US will have no middle-class work available. The doom prophets misunderstand comparative advantage - the jobs move abroad because the US citizens are better positioned to do something else. China’s big, and the world is even bigger. Yet, even the smallest country has a role in the global economy because as more humans consume more resources, the humans best placed to serve different demands are spread across the trading partners.