Thoughts on Economics, Politics, Finance, and the World In General
Don Boudreaux makes a great point in his post on how outsourcing, importing, and off shore business do not always pay off. Even though we put our money into another's product or business, does not automatically mean they will invest in ours.
Don Boudreaux makes an excellent argument in his post about the inequality of international trade and business. Just because we invest our money into off shore companies and products does not automatically mean they will do the same to us.
I find that Dr. Boudreaux makes a great argument because there are obviously not the same amount of imports as there are exports in a country. Also, when Boudreaux mentions that a well-being of a country does not depend on whether the equality that a country imports or exports he makes a great argument, especially because I doubt most countries export more than what they import to their own countries.
I think this supports what has been discussed in class, as we have seen that not necessarily will two countries export and import the same amount of goods to one another. Boudreaux's example of investing in stock instead of buying product directly is beneficial to businesses. Also, this may help explain why some governments invest in the reconstruction of other countries that have been devastated by natural disaster. While the investing country may not recieve anything tangible, the likeliness of that nation being more loyal, whether it be militarily or the possibility of trade in the future becomes more likely.
Boudreaux's idea of investing stock instead of direct purchases is beneficial to businesses. However, it could kind of backfire when some companies take advantage of the investors instead of catering to them.
Think about a family that won the lottery and never worked another day in their life. They would still be importing goods to their household, yet not exporting any(labor). Said family still participates in free trade.
this post just shows that thee are negative outcomes to outsourcing, and importing.And is an argument that shows how imports or exports wont equal the other.
I agree with Boudreaux, thinking that just because we import a certain amount from other countries that they will turn around and spend that money on goods from us is unreasonable. Just because imports don't equal exports doesn't mean that our economy is worse off.
I think investments are a better than direct purchases and that running a trade deficit is not as bad as it sounds sue to the fact we may earn the money back through investments.
It might be possible that our imports from a particular country is not equivelint to our export, but that does not mean our economy is worse off by trading. The least advantage of trading is the reduced cost of goods and services. Thats a gain in itself and can be utilized to produce other goods that we have a compartive advantage at.
Don Boudreaux makes a great point but in his argument he says that the italian shoemaker invests his money back into American business through the NYSE. Even though we don't trade goods/services with him are we still better off because he invests in American business?
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