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>Most of the time, capitalism works as a zero-sum game - profits can be extracted more easily from moving resources than from creating them and therefore moving

>Most of the time, capitalism works as a zero-sum game - profits can be extracted more easily from moving resources than from creating them and therefore moving will be prefered to making. This isn't true. At the heart of capitalism is any economic exchange- trading sheep for wheat, trading dollars for an xbox, etc. For any trade to occur, each party in the trade has to believe that they will gain from the exchange, i.e. get increased utility/value from it. By that means, any economic exchange where both parties are acting freely is most likely to be positive-sum, in terms of value received. Where jobs have moved to poorer countries, real wages have increased- this is indicative of the fact that they are now able to produce goods and services that their trading counter-parties perceive to be more valuable. This doesn't make rich countries as much worse off as you think it does- the majority of the increased production of poorer countries goes to meet local needs, overall having a relatively small effect on the price of global labor. On your other point, I will agree with ya that our current income inequality is pretty bad.

flyinRyan 13y ago
> trading sheep for wheat Amusing example, since it is zero sum even if the two parties don't perceive it as such.
unclebucknasty 13y ago
Your explanations are textbook idealizations but don't hold in the real world (at least in the context of this discussion) and leave out some very important factors. For instance, while it may be positive sum strictly for trading partners, the positive value accrues to a smaller percentage of the population (i.e. the corporations and shareholders) and frequently even comes at the expense of the worker (or ex-worker). This is in large part why we are seeing the economic inequality that you referenced. It is a product of the "zero-sumness" of the game when viewed in total vs. just between trading partners/corporations.
unclebucknasty 13y ago
>This doesn't make rich countries as much worse off as you think it does- the majority of the increased production of poorer countries goes to meet local needs, overall having a relatively small effect on the price of global labor. That bit of contorted reasoning has long been the dogma of some economists. Whether you belive this thinking became entrenched due to some grand globalist agenda or was simply wishful thinking, you must admit that it is counter-intuitive to believe that massive outsourcing to low wage countries would have no effect on domestic wages. And, now, many economists are having second thoughts: [1] http://economix.blogs.nytimes.com/2012/08/29/changing-views-of-globalizations-impact/ http://economix.blogs.nytimes.com/2012/08/29/changing-views-... And, from Nobel economist, Michael Spence [2] http://www.cfr.org/industrial-policy/evolving-structure-american-economy-employment-challenge/p24366 http://www.cfr.org/industrial-policy/evolving-structure-amer...

flyinRyan 13y ago

> trading sheep for wheat Amusing example, since it is zero sum even if the two parties don't perceive it as such.

unclebucknasty 13y ago

Your explanations are textbook idealizations but don't hold in the real world (at least in the context of this discussion) and leave out some very important factors. For instance, while it may be positive sum strictly for trading partners, the positive value accrues to a smaller percentage of the population (i.e. the corporations and shareholders) and frequently even comes at the expense of the worker (or ex-worker). This is in large part why we are seeing the economic inequality that you referenced. It is a product of the "zero-sumness" of the game when viewed in total vs. just between trading partners/corporations.

unclebucknasty 13y ago

>This doesn't make rich countries as much worse off as you think it does- the majority of the increased production of poorer countries goes to meet local needs, overall having a relatively small effect on the price of global labor. That bit of contorted reasoning has long been the dogma of some economists. Whether you belive this thinking became entrenched due to some grand globalist agenda or was simply wishful thinking, you must admit that it is counter-intuitive to believe that massive outsourcing to low wage countries would have no effect on domestic wages. And, now, many economists are having second thoughts: [1] http://economix.blogs.nytimes.com/2012/08/29/changing-views-of-globalizations-impact/ http://economix.blogs.nytimes.com/2012/08/29/changing-views-... And, from Nobel economist, Michael Spence [2] http://www.cfr.org/industrial-policy/evolving-structure-american-economy-employment-challenge/p24366 http://www.cfr.org/industrial-policy/evolving-structure-amer...