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I think the main reason is startup costs. Due to what little I know about Europe, I suspect it is due to regulations that protect employment and the environmen

by jmclnx 4y ago

I think the main reason is startup costs. Due to what little I know about Europe, I suspect it is due to regulations that protect employment and the environment (which I think is real good). For Tech, employment is the big one, but a startup may want the ability to fire someone without having to spend time dealing with Gov. Regulations. In the US, a small startup can fire you without even notifying any Gov agency (or the notification extremely simple). In the US, once heavy environmental regulations started going in, many companies started moving Manufacturing off to Asia. Now that the US is now allowing more pollution, you see some Manf. is coming back.

no_wizard 4y ago
I can't vouch for how European Countries labor laws influence start up culture over there, and I'm sure its definitely a thing, but I quibble strongly with the idea that US manufacturing was moved to Asia because of environmental regulations. Its generally accepted that its due to a one two punch of lower labor costs and a lack of willingness to invest back into factories due to de-regulation in the 80s and 90s which favored financialization of corporations[0]. This lead to a self-perpetuating cycle where American manufacturers struggled and couldn't make the investments needed to stay competitive in most markets where there wasn't regulation (such as car tariffs). This in turn lead to situations where, for instance, if you needed specialized manufacturing Asia ended up farther ahead on both price and quality than the typical US manufacturer. In short, it was de-regulation that lead to structural favoring of financialized corporations which in turn lead to a downward investment in manufacturing in the US while investment in manufacturing sectors in Japan, China and other countries soared[1] [0]: https://digitalcommons.law.seattleu.edu/sulr/vol36/iss2/17/ https://digitalcommons.law.seattleu.edu/sulr/vol36/iss2/17/ [1]: https://hbr.org/2009/07/restoring-american-competitiveness https://hbr.org/2009/07/restoring-american-competitiveness
jacobr1 4y ago
> Now that the US is now allowing more pollution, you see some Manf. is coming back. The bigger factor is that in some manufacturing areas, labor no longer dominates the costs. If you are using "robots" and other automation, then the cost of labor might not significantly impact unit economics.
kodyo 4y ago
Yep! You're describing trade-offs. There are consequences for making decisions in any direction, and the oligarchy that dominates a particular geographic area gets to decide which values to prioritize. It's anarchy on an international scale and it's glorious.

by jmclnx 4y ago

no_wizard 4y ago

I can't vouch for how European Countries labor laws influence start up culture over there, and I'm sure its definitely a thing, but I quibble strongly with the idea that US manufacturing was moved to Asia because of environmental regulations. Its generally accepted that its due to a one two punch of lower labor costs and a lack of willingness to invest back into factories due to de-regulation in the 80s and 90s which favored financialization of corporations[0]. This lead to a self-perpetuating cycle where American manufacturers struggled and couldn't make the investments needed to stay competitive in most markets where there wasn't regulation (such as car tariffs). This in turn lead to situations where, for instance, if you needed specialized manufacturing Asia ended up farther ahead on both price and quality than the typical US manufacturer. In short, it was de-regulation that lead to structural favoring of financialized corporations which in turn lead to a downward investment in manufacturing in the US while investment in manufacturing sectors in Japan, China and other countries soared[1] [0]: https://digitalcommons.law.seattleu.edu/sulr/vol36/iss2/17/ https://digitalcommons.law.seattleu.edu/sulr/vol36/iss2/17/ [1]: https://hbr.org/2009/07/restoring-american-competitiveness https://hbr.org/2009/07/restoring-american-competitiveness

jacobr1 4y ago

> Now that the US is now allowing more pollution, you see some Manf. is coming back. The bigger factor is that in some manufacturing areas, labor no longer dominates the costs. If you are using "robots" and other automation, then the cost of labor might not significantly impact unit economics.

kodyo 4y ago

Yep! You're describing trade-offs. There are consequences for making decisions in any direction, and the oligarchy that dominates a particular geographic area gets to decide which values to prioritize. It's anarchy on an international scale and it's glorious.