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How well is the United States competing? A comment on Papadakis
Author(s) -
Johnston Louis D.,
Chinn Menzie D.
Publication year - 1996
Publication title -
journal of policy analysis and management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.898
H-Index - 84
eISSN - 1520-6688
pISSN - 0276-8739
DOI - 10.1002/(sici)1520-6688(199624)15:1<68::aid-pam4>3.0.co;2-h
Subject(s) - assertion , economics , productivity , balance (ability) , aggregate data , international economics , international trade , macroeconomics , psychology , computer science , programming language , medicine , pathology , neuroscience
We contend that Papadakis's inferences regarding past and future competitiveness crises cannot be made on the basis of the evidence she has presented. We support this assertion in three ways. First, we argue that the import penetration ratio is not a reasonable measure of national competitiveness in international markets. Second, we show that conventional macroeconomic models can explain the deterioration in the trade balance during the 1980s. Third, we present data demonstrating that, as of 1990, the United States had very low unit labor costs relative to other developed countries, and had the highest level of aggregate productivity in the world.