Regarding what Anthony wrote below, here is a snippet from my book, Manufacturing Discontent.
I recall overhearing a conversation at an economics conference around 1992. I thought that I recognized the voice of the speaker behind me. I looked over my shoulder and confirmed that I was hearing Milton Friedman, the doyen of conservative economists, enthusiastically explaining the implications of the prospects of trade with China. Friedman made no mention of China's political and economic characteristics, which you might think would make close relations with China less than desirable in his eyes. Instead, he extolled the potential effect of expanded trade with China on U.S. labor markets. Friedman predicted that the potential addition of about one-half billion Chinese workers, many of whom would be producing for the U.S. market, would impose a decidedly negative effect on wages in the United States. Of course, China is not the only less developed economy whose products are supplanting those from the United States. China probably captured Friedman's interest only because of its immense size, comprising about one-fourth of the world's population. A few months later, the Wall Street Journal reported on Friedman's continuing enthusiasm for Chinese trade in a story about how workers were falling behind at the time: "It's not widely recognized how enormous this effect is," says Milton Friedman, the Nobel Prize-winning economist. "You've got a billion people in China who suddenly are available for use with capital. You have half a billion behind the (former) Iron Curtain" (Zachary and Ortega 1993) On Sat, Oct 13, 2007 at 05:48:40PM -0700, Anthony D'Costa wrote: > But labor markets are segmented, specific, and local in most cases. Hence, > shortages coexist with abundance. > -- Michael Perelman Economics Department California State University Chico, CA 95929 Tel. 530-898-5321 E-Mail michael at ecst.csuchico.edu michaelperelman.wordpress.com
