Student: Van Tran
ECON 201
OUTSOURCING, A TWO BLADE KNIFE TO THE ECONOMY
When was the last time you saw something with a mark on the label stating “Made in USA”, and
what was that item you saw? If you are thinking cosmetics are manufactured domestically, think
again. The majority of beauty products are imported from France, the UK and elsewhere. If you
ever go shopping at Wal-Mart, isn’t it so true that “Made in China” is the most common tag you
would find? From electronics, to t-shirts and baby toys, and even the mobile phone you have in
your pocket right now, most of the products we use in our daily lives are manufactured outside of
America.
I believe outsourcing to other countries is one of the most pressing issues facing the US
economy. A friend of mine, who is a senior sales manager at Packaging Corporation of America
(PCA), often complains about the amount of business she has lost to China, Mexico and now
Costa Rica. In macroeconomics, we define these countries to have a comparative advantage over
the United States.
This December will mark China’s 15th year of becoming a member of WTO1. Since then the
country with over 1.4 billion people has risen to be the second largest economy in the world.
Cheap labor and material costs, rich natural resources, and a favorable geographical position
have made China the “workshop of the world”. They make the acquisition of cheap good in the
United States a possibility. The United States is also outsourcing to South East Asian countries
