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 Author: taurusthetenacious Time: 09/21/04 08:46 PST This is a reply to message no. 14588 by acroduster1 Reply | Original Message | New Topic | List Topics | List Messages on This Topic
 Current Topic:I know this one will light some fires... Im actually taking an economics course this semester. We just learned about something called "opportunity cost. lets say you have 2 countries producing 2 products, x and y. One country is more developed than the other so it produces more. Because time and production facilities are limited. they can only produce a certain amount of each. They can either produce 10 of x and none of y or vice versa in one standard cycle. The other less developed country can produce in the same way only a limited amount of products. They can produce 3 of x or 6 of y in one standard cycle.       If this is the case then that means for the developed country, the opportunity cost of producing one of either item is 1 of the other, where for the other country, though they can produce less of it, they have a lower opportunity cost for item Y. If this is the case, then what happens is that in trade, the less developed country is the one that specializes in the production of the good, because the opportunity cost is lower for them to produce it even though they have a lower capacity.       The corrolary of all this for us is quite simple, if we have outsourcing its better for the world economy because resources will be better distributed for the world economy as a whole, because itll be more efficient goods will be less scarce and cheaper and more common. The problem with this is that it really screws our fun. Because of this we cant do the work we want to do. the only real option is to change proffesions.        I dont doubt one bit that this situation is exactly like what our swiss colleague described about switzerland(i hope i spelt that right) in the 80's and 90's. Item X anyone?