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It Is Macro
...
J. Bradford DeLong
Economics and Blum Center, UC Berkeley; WCEG; and NBER
http://bradford-delong.com
| @delong |
delong@econ.berkeley.edu
June 28, 2019
I confess I do not get this from Paul
Krugman.
Yes, the trade defi cit crowds-out
traditionally-male blue-collar import-
substituting manufacturing jobs, but
imports crowd-in traditionally-male blue-
collar wholesale trade jobs, and fi nance
traditionally-male blue-collar construction
(and capital-goods manufacturing) jobs. If
you look at all traditionally-male blue-
collar—wholesale, construction,
manufacturing, and mining)–what you get
is not a story of the trade defi cit, but rather
a story of (a) macro shocks to aggregate
demand, and (b) the long-run technology-
and-preferences trend—some of which is
automation.
NAFTA is nowhere.
The 2002-2007 bilateral-trade
“
China
shock
”
is simply not a terribly big deal for
the country as a whole: employment in
traditionally-male blue-collar occupations
was flat. A big deal for places that found
their manufactures competing with new
imports from China, yes. But not for blue-
collar traditionally-male employment in
the country as a whole.
For the country as a whole, it is aggregate
demand—2001-3 recession, weak
recovery, 2007-9 catastrophe, and then
superweak recovery—with a supporting
role for technology-and-preferences
.
Paul Krugman
:
“
Yang asserts that
automation destroyed lots of
manufacturing in the midwest, [but] you
don't have to be a protectionist to realize
that the acceleration of job loss after 2000
was mainly about the surging trade
J. Bradford DeLong
It Is Macro
defi cit
…” <
https://twitter.com/
paulkrugman/status/
1144588595170357250
>
<
https://www.icloud.com/pages/
0uI_a26DHDfJF66kv3wDVGpBw
>
<
https://www.bradford-delong.com/2019/06/it-is-
aggregate-demandrecession-weak-recovery-catastrophe-
and-then-superweak-recovery.html
>
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