ECO 1302 Lecture Notes - Lecture 69: Labour Candidates And Parties In Canada, International Trade, Fallacy

• School: University of Ottawa
• Department: Economics
• Course: ECO 1302
• Professor: Mario Seccareccia

Document Summary

I ue re olved: co(cid:373)parati(cid:448)e ad(cid:448)a(cid:374)tage e(cid:454)poses the (cid:862)cheap foreig(cid:374) la(cid:271)our(cid:863) falla(cid:272)(cid:455). I ue redux: a last look at the (cid:862)cheap foreig(cid:374) la(cid:271)our(cid:863) argu(cid:373)e(cid:374)t. Appendix: supply, demand, and pricing in world trade. Canadians (and the citizens of many other nations) often want their government to limit or prevent import competition. A(cid:272)(cid:272)ordi(cid:374)g to this (cid:448)ie(cid:449), (cid:862)(cid:272)heap foreig(cid:374) la(cid:271)our(cid:863) steals jo(cid:271)s fro(cid:373) ca(cid:374)adia(cid:374)s and pressures. The facts are somewhat inconsistent with this story. For one thing, wages in most countries that export to canada have risen dramatically in recent decades. Clearly, something other than exploiting cheap foreign labour must be driving international trade i(cid:374) (cid:272)o(cid:374)trast to (cid:449)hat the (cid:862)(cid:272)o(cid:373)(cid:373)o(cid:374)se(cid:374)se(cid:863) (cid:448)ie(cid:449) of the (cid:373)atter suggests. I(cid:374) this (cid:272)hapter, (cid:449)e (cid:449)ill see pre(cid:272)isely (cid:449)hat is (cid:449)ro(cid:374)g (cid:449)ith this (cid:862)(cid:272)o(cid:373)(cid:373)o(cid:374)se(cid:374)se(cid:863) view. Table 1: labour costs in industrialized countries as a percent of canadian labour costs, International trade enhances living standards for all parties involved because: