Talk:Post-industrial economy

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This article is sub-par with lots of opiniated nonsense. For instance, why should a post-industrial economy automatically have a large trade deficit and huge unemployment? Services can be exported as easily as goods (just ask the investment banks, for instance).

This article needs to be more neutral and more precise. Hopefully it can be re-written by someone who actually have a relevant economics background.

--rasmusdf 21:42, 13 July 2005 (UTC)

It's sub-par insofar as it lacks depth and examples, but fundamentally correct. While services are exportable, labor is a portable commodity and a service economy (or the service sector in a mixed economy) no longer depends heavily on plant and machinery as an industrial one does, making it more mobile as a result. --67.169.167.20 05:18, 20 July 2005 (UTC)anigbrowl

Would you agree that because services are exportable is why many companies outsource services whenever possible? That is another problem with a service based economy. I called the cable company the other day and the woman that answered the phone was somewhere in India. It is even easier to outsource service based employment than to farm out industrial jobs over seas. You have much less equipment to move. There is no effective way to compete with low wage expecting people of developing nations. Thats the point I was intending to make when I wrote the article(I did have great difficulty hiding the Democrat in me :)). Its the evolution of technology vs the isolated pockets of wealth that are found through out the world. Sorry to disappoint you but I have a great amount of economics background. Actually that was my major.

I think that's a fundamental misunderstanding of services. You're looking at this obviously tremendously broad sector of the economy (essentially everything which isn't a manufacture or agriculture) and assuming that it is all like a call center, low paying and easily mobile. Fact is the call center may have moved, the guy who came to fix your cable didn't fly in from India. Nor does your lawyer phone in a court testimony from Vietnam. The highly skilled jobs will be naturally drawn to areas where they will have a high standard of living. What occurs in services is that labor is the entire factor of production and thus where the company locates itself is decided more by where the skilled labor locates itself. If labor costs 1/10000th in Country A then it does in Country B, but Country A has no Engineers, you're not going to see an engineering firm outsource its labor from Country A to Country B. Its not this mass migration of jobs is a question of comparative advantage (as international trade always is). So as a result you will see the first world moving towards a highly skilled populace as the nations specialize.

--Thematic-Device 19:17, 19 November 2006 (UTC)

[edit] High unemployment

Currently the article says: A common trait that these economies have are high unemployment.

I realise this statement is commonly made, but I don't think it bears close analysis. It is an idea that seems to be based on outdated theory.

http://en.wikipedia.org/wiki/List_of_countries_by_unemployment_rate

The countries with high unemployment are in Africa (Cameroon, South Africa, Libya), the former Soviet Union (Turkmenistan, Kyrgystan), former Yugoslavia (Serbia, Montenegro, Bosnia and Herz), the middle-east (Yemen, Iran, Lebanon) and various countries in Asia and the Pacific (Indonesia, Nepal). Even the fast developing India has 7.80%.

The post-industrial economies mainly have low unemployment levels: Australia 4.3%, UK 5.4%, USA 4.8%, Ireland 4.3%, New Zealand 3.8%, Canada 5.9%. The post-industrial nations lie in the "bottom third" of the table ranking unemployment. —Preceding unsigned comment added by Ordinary Person (talk • contribs) 04:24, 14 December 2007 (UTC) Ordinary Person (talk) 04:39, 14 December 2007 (UTC)

[edit] Removed paragraphs

I've removed these two paragraphs:

The problem with a service-based economy is the nations over time experience a long term trade deficit which degrades the economy. A common trait that these economies have are high unemployment and high wages. This is because as more manufacturing jobs move to developing nations, more jobs are lost. The people that lost these jobs tend to feel that they are entitled to the high wage they previously earned and have difficulty finding suitable employment.

One way some nations deal with this economic slowdown is by borrowing more money and lowering interest rates. This artificially fixes the problem by creating false wealth. This also causes the affordable housing to disappear because of lower interest rates more expensive homes become more affordable. After interest rates rise to normal levels it is found that the artificially high property values are incorrect. This is what is referred to as a real estate bubble

Economies that have a large service sector DO NOT necessarily have a trade deficit. For example, the United Kingdom is a net exporter of services and has a trade SURPLUS in this sector. See for example: http://www.bankofengland.co.uk/publications/quarterlybulletin/service.pdf

The second paragraph makes no sense at all, since it assumes that a service economy represents an economic slowdown, when in fact it does not. It's quite possible to have a booming economy based on services alone. Rubisco (talk) 15:21, 7 January 2008 (UTC)