Comments on: In-Sourcing http://www.creativeclass.com/creative_class/2009/06/17/in-sourcing/ The source on how we live, work and play Fri, 19 Mar 2010 17:13:44 -0400 http://wordpress.org/?v=2.8.5 hourly 1 By: Ken Jarboe http://www.creativeclass.com/creative_class/2009/06/17/in-sourcing/comment-page-1/#comment-13067 Ken Jarboe Wed, 17 Jun 2009 18:51:20 +0000 http://www.creativeclass.com/creative_class/?p=11976#comment-13067 The Blinder/Baldwin argument here is talking apples and oranges. Blinder was looking at those professional service jobs which could be subject to international wage pressure because they could be located anywhere. Baldwin is looking at trade in professional services (i.e. revenues). It is true that our business services trade is in surplus – and has been for some time. Export has been growing slightly faster than imports. But that does not mean that business and professional services are not subject to low wage competition. They are – and it will eventually affect both our ability to export as well as the size of our imports. By the way, it doesn’t take IMF data to see what I happening in business services trade. BEA publishes it monthly in the services under the category of “other private services.” Cover in that category are “education services; financial services (includes commissions and other transactions fees associated with the purchase and sale of securities and noninterest income of banks, and excludes investment income); insurance services; telecommunications services (includes transmission services and value-added services); and business, professional, and technical services. Included in the last group are advertising services; computer and data processing services; database and other information services; research, development, and testing services; management, consulting, and public relations services; legal services; construction, engineering, architectural, and mining services; industrial engineering services; installation, maintenance, and repair of equipment; and other services, including medical services and film and tape rentals.” (from BEA) I use that data to publish the monthly trade in intangibles on my blog www.intangibleeconomy.org The Blinder/Baldwin argument here is talking apples and oranges. Blinder was looking at those professional service jobs which could be subject to international wage pressure because they could be located anywhere. Baldwin is looking at trade in professional services (i.e. revenues). It is true that our business services trade is in surplus – and has been for some time. Export has been growing slightly faster than imports. But that does not mean that business and professional services are not subject to low wage competition. They are – and it will eventually affect both our ability to export as well as the size of our imports.

By the way, it doesn’t take IMF data to see what I happening in business services trade. BEA publishes it monthly in the services under the category of “other private services.” Cover in that category are “education services; financial services (includes commissions and other transactions fees associated with the purchase and sale of securities and noninterest income of banks, and excludes investment income); insurance services; telecommunications services (includes transmission services and value-added services); and business, professional, and technical services. Included in the last group are advertising services; computer and data processing services; database and other information services; research, development, and testing services; management, consulting, and public relations services; legal services; construction, engineering, architectural, and mining services; industrial engineering services; installation, maintenance, and repair of equipment; and other services, including medical services and film and tape rentals.” (from BEA)

I use that data to publish the monthly trade in intangibles on my blog http://www.intangibleeconomy.org

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