Topic 9: The Myth of Outsourcing's Effect

Just like the previous journal said, the definition of globalization is like a movement of a local good, services, trades, communications and other factor to the worldwide. The definition of comparative advantage will be the advantage for certain country that has the better technology, goods, or skills compare to other countries or the rest of the world. And the definition of outsourcing is to move the jobs or the works out to foreign countries and not the home country. The reason why recently companies start outsourcing relates to globalization and comparative advantages. Because of comparative advantage, companies send the jobs to other countries to get cheap labors, which might be one of the advantages for the country. People might think that it was a terrible idea since this might let a lot of people lose their job, but actually it didn’t. According to the video, it might seem like the opportunity of getting a job is decreasing in the past four years, but in fact if we see it broadly as past twelve years, there are 20 million more jobs that has created. Based on this we can say that the companies are being more efficient on how they are spending money by paying less wage on cheap labor in able to create more jobs on other important factors. Therefore, the production will be the same but there will be other new idea and technology be created from the additional money the companies have saved. In conclusion, if we didn’t have outsourcing, people might felt happy about their original job, but the economy will be not be as good as if we have outsourcing.