Path: utzoo!utgpu!attcan!uunet!wuarchive!gem.mps.ohio-state.edu!apple!mips!vaso From: vaso@mips.COM (Vaso Bovan) Newsgroups: sci.electronics Subject: Re: US consumer electronics industry Summary: Protectionism harmful Message-ID: <28587@buckaroo.mips.COM> Date: 1 Oct 89 22:01:54 GMT References: <1989Sep28.082305.10099@uokmax.ecn.uoknor.edu> <17660023@hpfcdj.HP.COM> <14932@netnews.upenn.edu> Reply-To: vaso@mips.COM (Vaso Bovan) Organization: MIPS Computer Systems, Sunnyvale, CA Lines: 22 In article <14932@netnews.upenn.edu> farber@linc.cis.upenn.edu (David Farber) writes: > >Would any one care to comment on what the actual benefits to the nation >are in having assemply work done here. What percentage of the >profits from the sale of the products stays in the usa as opposed to >an equivalant product (which does not exist) designed >built and sold by an Americal company in the US. > >Just asking > The "percentage of profits ... that stays in the USA" is irrelevant. The American consumer benefit most, when the product is produced and sold in the most efficient way (ceteris paribus). This is the standard economic argument, and one that is often lost in protectionist noise. "Of course, in a non-full-employment economy, all bets are off." That's a quote from a respected economist; I can't remember who's (Samuelson ?), which expresses the idea that when there are unused assets in an economy, (labor, for instance), it sometimes makes sense to produce at home, (ie in the USA), even if inefficiently. In such cases, the consumer effectively subsidizes the (American) producer, as in Corporate Welfare Bums.