Explain Why Economists' and Laypeople's' Views of Outsourcing Differ

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The Answer is Laypeople often do not recognize the gains from trade,such as a decline in prices,while they easily identify the loss of jobs caused by trade adjustments as countries shift their patterns of production in accordance with comparative advantage.Economists point out that it is because of these low prices that we can afford the high level of consumption that we enjoy.Laypeople often believe that since countries,like China,have lower wages,they must have a comparative advantage in just about everything.Economists point out that if one country (e.g.China)has a comparative advantage in one set of goods,then other countries must have a comparative advantage in another set of goods.Laypeople often think of trade only in terms of manufactured goods.Economists point out that trade also includes services (including the services provided by traders).

Explain Why Economists' and Laypeople's' Views of Outsourcing Differ

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