Offshoring of American Jobs: What Response from U.S. Economic Policy?

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Overview

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.

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What People Are Saying

From the Publisher
"Outsourcing has become synonymous with 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

"This outstanding volume provides an exceptional contribution to the debate on outsourcing. 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

Henrik Horn

"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

K.C. Fung

"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

Henrik Horn
"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
K.C. Fung
"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
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Product Details

Meet the Author

Jagdish Bhagwati is University Professor at Columbia University and External Advisor to the Director General, World Trade Organization and Senior Fellow for International Economics with the Council on Foreign Relations. He was named Distinguished Fellow of the American Economic Association in 2003.

Alan S. Blinder is G. S. Rentschler Memorial Professor of Economics and Public Affairs at Princeton University. He is the author of The Quiet Revolution: Central Banking Goes Modern and other books.

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

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Table of Contents

Introduction Benjamin M. Friedman Friedman, Benjamin M.

1 Don't Cry for Free Trade Jagdish Bhagwati Bhagwati, Jagdish 1

2 Offshoring: Big Deal, or Business as Usual? Alan S. Blinder Blinder, Alan S. 19

3 Comments Richard B. Freeman Freeman, Richard B. Douglas A. Irwin Irwin, Douglas A. Lori G. Kletzer Kletzer, Lori G. Robert Z. Lawrence Lawrence, Robert Z. 61

4 Responses Jagdish Bhagwati Bhagwati, Jagdish Alan S. Blinder Blinder, Alan S. 101

Contributors 123

Index 125

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