Import from China. Good or bad?
Why Import From China?
Why Import from China?
Chinese import has been center of debate for all sort of reasons. It is a threat or opportunity depends solely on how you view it. There are numerous protest group which will advocate banning import from China citing reasons from product safety to unemployment. All these issues are real but to decide import or not requires pragmatic thinking.
We import because it it cheaper to produce in another country then our own. Manufacturing is always done at place where total cost of production (rent, labor etc.) is cheapest unless some other factor such as government policy, public view etc. prevents it. Another reason for imports could be monopoly of physical resources, technology or patent rights that a country enjoyes over other.
As of year 2011 top three exporter to USA were China followed by Canada and Mexico. What is more interesting to note that Import from Canada and Mexico combined is about one and half of total Import from China. So why to have so much discotent and apathy against importing from China?
Why people do not like imports?
The most common answer you will hear is that cheap imports from China takes away domestic jobs. Lets ask ourselves a question - what type of jobs? Blue collar factory worker's job. The reason is simple that USA and other industrialised nations are shifting from manufacturing to service economy which makes citizen more productive. In past 50 years there has been gradual shift from manufacturing to service. Today only 1 in 7 people are employed in factory work as oppose to 85% in service industry. Economist will find similarity in this situation with industrial revolution 200 years back when farmer or artisans cribbed about jobs taken away by factories. Currently a fraction of work force is employed in farming which feeds entire nation. So when there is change people who can not adapt to change do not like it.
Even consumer spending pattern has changed. In 1947 expenses on food and cloth was almost 2/5 of total expenses which can down to 1/6 by 2007.
However change is inevitable because as country becomes richer (rise in per capita income) skill premium rises.
International Trade With USA
Top 5 Import partners of USA
To Import or Not?
Is it good to import from other countries?
Import 101: step by step guide
- Import 101: step by step guide - Import from China
How to import and make money by selling on ebay/Amazon
Import of Goods to USA (2011)
- Foreign Trade - U.S. Top Trading Partners
Import from China
- The iPhone Economy - Video Feature - NYTimes.com
Apple’s iPhone is a model of American ingenuity, but most of its components are manufactured somewhere else, leading to the decline of other kinds of jobs.
America's dominant service economy needs cheap import from China
- America's dominant service economy | Minnesota Public Radio News
America's economy has undergone a gradual but significant change in the past 50 years: We're no longer an economy of manufacturers; instead we're an economy of service.
You may also like
Statistics show that a small percentage of luggage is lost by airlines every year. Lost or damaged luggage could be a major annoyance. Many do not know how to properly deal with it. Read this hub to prevent potential losses caused by losing bags.
Wholesale Markets in China
- How to Bargain in China's Wholesale Markets
A guide to bargaining and negotiating a lower price in Chinese wholesale markets with practical haggling techniques to obtain lower prices from a Chinese wholesaler.
© 2012 Kamal Mohta