I don't think developed countries should focuse on being competitive in raw materials and basic manufacturing. Countries that have a substantial percentage of

I don't think developed countries should focuse on being competitive in raw materials and basic manufacturing. Countries that have a substantial percentage of their population that is not very educated have a comparative advantage (in the technical sense [1]) in fields that require a lot of unskilled labor. E.g. raw materials & basic manufacturing. So the developed world will always have a hard time competing with them in these fields. [1] http://en.wikipedia.org/wiki/Comparative_advantage http://en.wikipedia.org/wiki/Comparative_advantage