Comments on: Reverse Globalization?

By: Alex Thornton

Alex Thornton — Wed, 26 May 2010 00:53:40 +0000

This is a good point; modern globalization is predicated on the existence of a cheap fuel source, oil. Once oil reserves near depletion, oil prices will permanently rise an globalization may reverse.

However, I wonder about the car example you provide, Matt. I suspect that car manufactures come to America primarily to avoid high tariffs, not high shipping costs. These tariffs can add several thousands of dollars if the car is not assembled in the United States.

By: Jordan Wente

Jordan Wente — Sat, 10 Apr 2010 23:14:41 +0000

I would have to say it’s the evolution of globalization rather than the end of it. I think companies are recognizing more and more that in these rapidly developing countries there are new markets of consumers. Labor is much cheaper in many of these countries. The cost of shipping aside, producing products in these countries cuts costs in other ways. I mean isn’t that why we have sent manufacturing of products overseas in the first place. However, now there is an added benefit, the economic growth is enabling people in developing countries to be able to purchase these goods as well. Businesses are now starting to capitalize on the growing markets. In my opinion this is the main reason why Coca-cola and automakers are producing their products in India for Indians. This reminds me of the Philips example given in The Elephant and the Dragon.

It’s pretty clear that as transportation costs continue to increase there will be a shift in the path of globalization. Hopefully there will be more of a concern placed on the cost of transportation of goods to the environment; in addition to the just the increased costs of shipping.

By: Erika Bylund

Erika Bylund — Thu, 08 Apr 2010 02:58:32 +0000

Those of you in GSB 533 (macroeconomics) are all too familiar with the discussion behind the phrase “unintended consequences.” It’s really interesting to see how things come full circle, and though we may think we know where the future is going, it doesn’t always (and frequently doesn’t) turn out that way. Matt’s blog asks the reader to consider if reverse globalization is a good thing or a bad thing. I personally think it’s ironic that America has been worried for a long time about outsourcing American manufacturing jobs (a specific example being the Detroit auto industry). And now, here we are with foreign auto manufacturers like Hyundai knocking on our doors, asking to set up manufacturing plants in the U.S. What else can we do and what kinds of incentives can we offer (aside from keeping oil prices high) to encourage other foreign manufacturers to set up shop in the U.S. and bring those jobs back?

By: Frank Blazkiewicz

Frank Blazkiewicz — Tue, 06 Apr 2010 06:58:45 +0000

The interaction of unifying and disruptive elements of the global economy is wonderfully complex. To be simplistic, I would argue that this is primarily an evolution in the “globalizing” world.

One of the stages of a transnational company is where the company expands its manufacturing capabilities into areas where they wish to sell their products. Part of that is the recognition of cost savings due to either reduction in possible import tariffs, labor costs, and shipping costs. Additionally many countries link the opening of its markets with the opening of operations. This creates local jobs and assists the local economy as well. China is a clear example of a country which uses its market potential as a bargaining chip.

The point about the increasing costs of shipping due to oil prices reaching the highest levels on record highlights concerns about disruptions in the relations between countries and trade. However, I would tend to think that the most critical danger to globalization would a major armed conflict.

By: joe

joe — Sun, 28 Mar 2010 20:18:19 +0000

http://www.amazon.com/Unsavory-Characters-Eclectic-English-Teachers/dp/1451545037/ref=sr_1_1?ie=UTF8&s=books&qid=1269806682&sr=8-1