Question by : Does outsourcing really destroy jobs or does it displace them?
The theory of comparative advantage states that when countries focus on what they are best at they can both consume more which is true, no problem here. My issue isn’t an attack on the theory of comparative advantage but how applicable it is to the real world. While there are clear examples of where comparative advantage has helped develop wealth there also appears to be a wealth of examples where this was not the case.

In other words, if we focused on what we were best at and China did the same. Lets say we focused on making chemicals, computers etc. and China focuses on the cheap stuff like that desk lamp that might catch fire on my desk it’s clear that we are both better off even if it means that we no longer make the lamp here because we can focus on other things. As a result we both can consume more stuff.

In order for this to work, however, this implies that when a job is sent overseas that capital is then either immediately or reallocated somewhere else in the economy relatively quickly to offset this, however, it is not completely clear to me that this is the case.

Furthermore, China continues to devalue their currency which artificially creates a huge trade imbalance between us. If we were truly trading as David Ricardo intended, wouldn’t there be no trade deficit?

While the theory of comparative advantage is sound, what makes it not always work correctly. Why aren’t the jobs always created. I understand that the lost job isn’t the problem but rather the lack of new jobs being created in a timely manner.

Please make sure you discuss how comparative advantage applies to the situation and why it does or does not work. If you are unfamiliar with the theory, see here before answering http://en.wikipedia.org/wiki/Comparative_advantage
I think the answers are great so far, but they just don’t quite answer the question. I guess I need to clarify that I am really looking at a period where we are in recession with high unemployment. When we are at full employment it is clear that the benefits are immense and open trade is a great backstop against inflation because it prevents us from exceeding our resource limits. I guess what I am really trying to find out is whether these things hold true in a high unemployment environment. What I am saying is that comparative advantage seems to assume full employment. I am a big propenent of free trade and am for it but some of the components seem amiss. It’s like free markets, they work when tweaked (via Keynes and of course Paul Samuelson). In other words what is causing the comparative advantage not work now like it did in the 90s. China is adding jobs as we shed. We are now adding some but not making up for the deficit.

Best answer:

Answer by Anjaree
The Ricadian theory of trade based on comparative advantage has ignored the production process based on globalization. One good at Ricado time could be produced using the whole process in only one country. But nowaday it can be produced joining hands by many countries based on comparative advantage and specialization. The trade which increases our wefare is not based on good but every step of production divided internationally based on specialization.

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Question by Mr. October: Are there any jobs in IT? Serious replies only.?
X has two associate degrees, a high GPA, and experience in IT from several temp jobs and internships. She wants a career in Helpdesk and/or database management. She is 47 years old, has had a number of interviews, yet over almost 3 years, has been unable to get a real job offer with benefits, etc.

Age discrimination?

Needs further degree work?

Simply no jobs in this field (too much competition/outsourcing/etc)?

Any advice for X? Serious replies only, please.
X stayed at home, raised her kids and went back to college when they’d grown up. She just graduated 3 yrs ago.

Best answer:

Answer by Crazy for a guy
Suggest getting MSCE certification

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Question by tenno1234: whats the future of customer support call centre jobs ?
Will they be outsourced overseas ? Is the a bad career to get into ?

Best answer:

Answer by Judy
As much success as I’ve had dealing with offshore call centers, I’d guess there’s a chance that companies who care about customer service might bring much of that work back from overseas. But I don’t think I’d go into it now, expecting to have a reliable job for my career

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Question by Pumpkin: Outsourcing to Asia is such a big thing. What other jobs could be outsourced to other countries?
Technical support, software development, and medical transcription are being outsourced to Asia. With these jobs moving out of the US and Europe, what other jobs could be outsourced? Paperclip testing perhanps?

Best answer:

Answer by lude_head
since outsourcing to third world countries has begun, customer service has hit an all time low, this is fact

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Question by Protege: Foreign outsourcing – Do you oppose or support it? Would you outsource jobs if you were head of a Major Compan?
Ya know – this question is more than just a black and white issue. But just tell me what you think – Pros and Cons

Best answer:

Answer by Liberal Poster Boy
Support. Yes.

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