Quality of Life

We are all striving for a better quality of life but how do we define and measure it? A good income, a job, a roof, good clothing, health, etc. Scientists and international organizations are trying to measure the quality of life in different countries, and come up with different rankings depending on the criteria used. An article in the New York Times (Sep. 7, 1997, p. 4) ranked Bulgaria above the U.S.

For most of us a good job is a major part of our quality of life. Many of you are concerned about losing your jobs and the jobs of family members and acquaintances to foreign workers that you consider underpaid. That is a serious concern. This threat to your quality of life can come from foreigners both in this country and abroad.

One source is illegal immigrants.

Another consists of jobs being exported to foreign countries. Usually, jobs are being exported to low labor cost countries. There is a benefit in that products produced in these countries become available in the U.S. at a lower price than U.S. produced products. In an attempt to conserve jobs, some people propagate that we should pay the higher price for American made products in so-called "Buy American" campaigns.

Economic theory proves that such protectionism is bad for everyone. Among arguments used are specialization and comparative advantage.

The world economy or any economy benefits from specialization, and it is achieved through comparative advantage. The classical example concludes that port wine should be produced in Portugal and clothes in England. Today, maybe computer programs should be written in India, television sets made in Taiwan, etc. Comparative advantage is popularly explained with the example of the lawyer, who is the best lawyer in town, and at the same time the fastest one in town in keyboard entry, he has an absolute advantage in both. Still, he should leave the keying to his assistant and concentrate on practicing law where he has a comparative advantage.

The production of some goods and services cannot be moved. In the old agricultural society, workers had to be close to the fields. The same goes for mining and heavy industries.

Heavy products, like automobiles, are typically made close to their market. They can be transported by boat over the Pacific or Atlantic, but at an added cost. On the other hand, even though airplanes are relatively heavy and bulky, they can be flown from an assembly plant to the user.

The situation is different in today’s IT society. A person can write programs in India for delivery in the U.S.

We will still need local labor for delivery of goods (even by mail or UPS), to serve food, and to install, maintain, service and repair products.

Now, do we engineers have to come to where the work is or can the work come to us? Do we need to communicate and be close for that reason? That depends on the product or service that we provide. Those working with power generators will have to come to them, while some programmers and design engineers need to communicate with peers, others can work at home.

How does this affect our quality of life? It will depend on your own rating scale. If you prefer a short term solution with short term benefits you should vote for protectionism. However, if you are concerned about long term benefits for you and your children, free trade is the solution.

Bertil Lindberg

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Last revised July 16, 2030.
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