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It seems perfectly reasonable to do both. One may want to cool the economy as a whole to fight inflation, while boosting the local semiconductor industry to gai
by vanviegen 4y ago
It seems perfectly reasonable to do both. One may want to cool the economy as a whole to fight inflation, while boosting the local semiconductor industry to gain some digital independence.
- Ericson2314 4y agoThe reason we have a chip shortage in the first place is that slow growth has rationalized underinvestment. I suppose we can have a reshored chips industry by handing out electronics coupons in a recession, but that is a really blunt instrument with high distortion risk. It's not like all chips are fungible or whatever, there is a real risk of subsidizing the "wrong thing" without a broader macroeconomic story (which could be planned in theory, but won't be in the US so we must rely on markets) to validate the "end use values" --- ensure the downstream benefits are extent to discipline the upstream chip production why also incentivize it. The good thing about finding bottlenecks in a high pressure economy is those are the actual problems to be solved. But problems shift --- the goalposts actually aren't fixed --- so better to keep things high pressure the whole time.