Housekeeping: For Upstream, I spoke with Agnes Callard about philosophy. For Moment of Zen, we spoke with Eugene Wei about the state of social media. For Econ 102, Noah Smith and I spoke about the fragmentation of libertarianism. For Media Empires, I jammed with Greg Isenberg
Agree, I’m a big fan of Thiels work - but he’s not outsmarting economists on trade or monopoly.
I think for the 1971 piece overregulation is underrated as a factor, there are very specific bottlenecks in each industry. I debated with Tabarrok on that point pushing back against his Baumol Effect piece and he didn’t push back much: https://open.spotify.com/episode/472XmRU4HiHNvJwjvaSxFk?si=g8r9akiuQLq9aJ4msCgf7w
Great article, if only people understood intuitively the benefits of trade!
"Manufacturing abroad, for example, can allow workers in the U.S. to focus on higher value-added tasks such as research and development, marketing, and general management. Additionally, expanding overseas to serve foreign customers or save costs often helps the overall company grow, resulting in more U.S. hiring."
I think that one thing is missing from the national conversation is that we don't have globalization or protectionism. But rather we have regionalization. Shannon O Neil wrote about this in "The Globalization Myth, Why Regions Matter". (You need to have her on in your podcast).
We basically have three regions that dominate 85% of global trade. North America, Europe, and East Asia(which includes south East Asia) export most of the world's goods.
Latin America, Africa, the Middle East, Russia & its former Central Asian proxies, and South Asia make up the the remaining 15%.
Also, 70% of European trade is within Europe. 50% of East Asian trade is within East Asia, and North America has 40% interregional trade.
For every Boeing (which is truly global in terms of its supply chains), there is many more of Chinese Great Wall Motors and German Audis. For Great Wall, the transmissions come from Japan, Chassis from South Korea, and bumpers from Taiwan. For German Audi, the power steering come from Sweden, water pumps from Italy, wheels from Czech Republic, and circuits from France. Now more regions are trying to make their own European Unions. Probably the one that's most successful is ASEAN, Association of South East Asian Nations which is going to be the alternative investment destination instead of Asia.
You can see more here (shameless plug):