The Relativity of Comparative Advantage of Low Labor Cost and the Absoluteness of Technological Advantagesthe Relativity of Comparative Advantage of Low Labor Cost and the Absoluteness of Technological Advantages Essay Example
The Relativity of Comparative Advantage of Low Labor Cost and the Absoluteness of Technological Advantages
Introduction:
Under the atmosphere of globalization of economy, the opportunities for the manufacture enterprises of fewer technologies located in less developed countries and areas to survive and develop have emerged. The opportunities are not kindly offered by the competitive world leading producers but created by “Comparative Advantages of Low Labor Cost”.
Analysis of the Relativity of Comparative Advantage of Low Labor Cost:
For example, in China, during the recent twenty years, the words of comparative advantages have been repeated for hundred times either in a lot of local government reports or in some newspapers. Actually, the comparative advantages in China are of low labor cost most of the time. Compared with the labor cost in Europe and North America, the labor cost is much lower in China. And another important factor to make the low labor cost to be an advantage is of the technology. In China, the comparatively matured industrial technology that is not advanced but meets the requirements, and the reachable basic education resources that equip the labor with the necessary technologies to process have converted the low labor cost into an advantage. Therefore, in Africa, there are a lot of countries with low labor cost, but their low labor cost cannot be a comparative advantage because they are without the comparatively matured industrial technology and the reachable basic education resources.
However, from the above explanation, it can be seen that low labor cost also delivers another piece of information that low labor cost is of basic technology and education. This is the limits of a low labor cost that it can only deliver basic or non-advanced process not only for manufacture industry but also for service industry. For manufacture industry, China can be a very good example, in the south of China, especially in
Introduction:
Under the atmosphere of globalization of economy, the opportunities for the manufacture enterprises of fewer technologies located in less developed countries and areas to survive and develop have emerged. The opportunities are not kindly offered by the competitive world leading producers but created by “Comparative Advantages of Low Labor Cost”.
Analysis of the Relativity of Comparative Advantage of Low Labor Cost:
For example, in China, during the recent twenty years, the words of comparative advantages have been repeated for hundred times either in a lot of local government reports or in some newspapers. Actually, the comparative advantages in China are of low labor cost most of the time. Compared with the labor cost in Europe and North America, the labor cost is much lower in China. And another important factor to make the low labor cost to be an advantage is of the technology. In China, the comparatively matured industrial technology that is not advanced but meets the requirements, and the reachable basic education resources that equip the labor with the necessary technologies to process have converted the low labor cost into an advantage. Therefore, in Africa, there are a lot of countries with low labor cost, but their low labor cost cannot be a comparative advantage because they are without the comparatively matured industrial technology and the reachable basic education resources.
However, from the above explanation, it can be seen that low labor cost also delivers another piece of information that low labor cost is of basic technology and education. This is the limits of a low labor cost that it can only deliver basic or non-advanced process not only for manufacture industry but also for service industry. For manufacture industry, China can be a very good example, in the south of China, especially in