I find it rather ironic that so many people in America, the land of capitalism, hate outsourcing so much. This is simple economics right out of Adam Smith. People in India can do the same things as people here in the States, and at a significantly lower price. Therefore, they get the jobs, and rightfully so. One good benefit for Americans is that this allows their employers to use that money elsewhere. And yeah, IT job salaries might fall, and some people might have find jobs outside the IT field. But for t
You obviously don't know crap about economic theory. Free trade relies on the idea of comparative advantage, that one place is inherently better at doing something than another. When Indian programmers are just as good as American programmers and there's no transport cost (facilitated by internet transmission of code), then it really is a race to the bottom to see who can pay the least for the samee service. There's no advantage to hiring US programmers, so it goes to India! In short, we're screwed! And, as
A competitive advantage is all about value. Can you produce a better product, and for how much? The reason that Japenese did so well in the auto markets is that they not only produced BETTER cars, but did it for less.
In this case India is showing that they have a competitive advantage in programming. They can produce code at the required level and do it for FAR less than the American programmer.
It is not, however, a race to the bottom. The Indian salary will not remain static. As the number of jobs and th
"In this case India is showing that they have a competitive advantage in programming. They can produce code at the required level and do it for FAR less than the American programmer."
Yep. They work for less. That's the race to the bottom.
"The Indian salary will not remain static."
Well, we're pumping money into their economy so they'll see an increase, that is correct.
"As the number of jobs and the complexity of the problems increase (remember, workers are a market just like anything else) the salary will begin to rise."
Maybe. But doesn't that pre-suppose that there will eventually be more jobs than programmers and that the jobs will become more complex?
"As the rest of the economy begins to feel the benefits of this economic boon in India, more and more IT workers will begin to do other things."
I don't see this. If the IT sector is making money, why move out of it? Unless some other sector is making even MORE money?
"Eventually the global market will achieve Equilibrium and the competitive advantage will close."
That's the "bottom". The lowest price you can pay someone to do the work.
In order for that factor to INCREASE you have to have MORE JOBS than programmers. Which I do not see happening.
"We talk about how these theories are untested, well we've seen the results of this same phenemenon in auto manufacturing."
Different. It costs money and time to move cars.
"After all, remember all of those car building jobs we 'lost' two decades ago? Well, they're coming back in droves."
The ones I see "coming back" are in Mexico where the parts are assembled and shipped up to the US.
Making a car is not the same as assembling a car.
The US does not make many cars anymore.
"The Japanese auto makers are now turning to American labor to build those same cars, as the Japanese workers salary has now surpassed the American auto workers salary.. factor in the cost of shipping those cars across the ocean and American labor makes a ton of sense for that field."
It's cheaper to hire someone to assemble a car in Mexico (NAFTA) and ship it up to the US than to assemble the car in Japan and ship it to the US.
Now look at our old auto cities. Massive unemployment, still. The jobs are gone.
After all, remember all of those car building jobs we 'lost' two decades ago? Well, they're coming back in droves."
The ones I see "coming back" are in Mexico where the parts are assembled and shipped up to the US.
Making a car is not the same as assembling a car.
The US does not make many cars anymore.
"The Japanese auto makers are now turning to American labor to build those same cars, as the Japanese workers salary has now surpassed the American auto workers salary.. factor in the cost of shipping th
I find it interesting that my employer is showing more sales and more customer loyalty than the "American" manufacturer.
Doesn't that have to do more with the "Made-in-America" laws that got passed a while back requiring n% of a car to be made/assembled in the U.S. so that the company can receive significant tax breaks and being able to call their product "Made-in-America"?
Outsourcing is a good thing... (Score:5, Insightful)
Re:Outsourcing is a good thing... (Score:5, Informative)
Re:Outsourcing is a good thing... (Score:5, Insightful)
In this case India is showing that they have a competitive advantage in programming. They can produce code at the required level and do it for FAR less than the American programmer.
It is not, however, a race to the bottom. The Indian salary will not remain static. As the number of jobs and th
Your "equilibrium" is the race to the bottom. (Score:3, Insightful)
Yep. They work for less. That's the race to the bottom.
"The Indian salary will not remain static."
Well, we're pumping money into their economy so they'll see an increase, that is correct.
"As the number of jobs and the complexity of the problems increase (remember, workers are a market just like anything else) the salary will begin to rise."
Maybe. But doesn't that pre-suppose that there will eventually be more jobs than programmers and that the jobs will become more complex?
"As the rest of the economy begins to feel the benefits of this economic boon in India, more and more IT workers will begin to do other things."
I don't see this. If the IT sector is making money, why move out of it? Unless some other sector is making even MORE money?
"Eventually the global market will achieve Equilibrium and the competitive advantage will close."
That's the "bottom". The lowest price you can pay someone to do the work.
In order for that factor to INCREASE you have to have MORE JOBS than programmers. Which I do not see happening.
"We talk about how these theories are untested, well we've seen the results of this same phenemenon in auto manufacturing."
Different. It costs money and time to move cars.
"After all, remember all of those car building jobs we 'lost' two decades ago? Well, they're coming back in droves."
The ones I see "coming back" are in Mexico where the parts are assembled and shipped up to the US.
Making a car is not the same as assembling a car.
The US does not make many cars anymore.
"The Japanese auto makers are now turning to American labor to build those same cars, as the Japanese workers salary has now surpassed the American auto workers salary.. factor in the cost of shipping those cars across the ocean and American labor makes a ton of sense for that field."
It's cheaper to hire someone to assemble a car in Mexico (NAFTA) and ship it up to the US than to assemble the car in Japan and ship it to the US.
Now look at our old auto cities. Massive unemployment, still. The jobs are gone.
Wrong! (Score:2)
Re:Wrong! (Score:1)
Doesn't that have to do more with the "Made-in-America" laws that got passed a while back requiring n% of a car to be made/assembled in the U.S. so that the company can receive significant tax breaks and being able to call their product "Made-in-America"?
Wow, an un-named company with a pseudonym poster. (Score:2)