I remember reading Robert Gordon's work as we debated these issues several years ago. So please don't get the impression that I think we should not study seriously the findings of bourgeois economists!
Quick comments.
1. Jha thinks the problem of unemployment has become structural across the OECD. He does not count as jobs full time work which does not raise the worker above the poverty line--the EPI has done important work here; he does count the discouraged, the incarcerated, soldiers, and unwilling part timers. He mainly attributes what he takes to be permanent structural unemployment to relocation of productive activity abroad. His findings are roughly consistent with Adrian Wood's about job loss.
2. Webber and Rigby in the Golden Age Illusion do introduce the question of the extent to which productivity and profitability can be raised by the relocation of productive capital abroad. I don't remember Gordon even speaking to this possibility. That's why I underlined it.
3. You seem to be saying that productivity gains are not so impressive and widespread as to encourage a general upsurge in real investment. But that's Jha's point, so don't understand where the difference is.
Yours, Rakesh
Rakesh Bhandari wrote:
>If I have read him correctly, Jha would point to perverse
>de-industrialization, meaning relocation of low productivity sectors
>of US industry abroad without commensurate growth in service sector
>and advanced mfg jobs.
>
1. First of all, if this were true - if low-productivity sectors had been relocated elsewhere without being replaced by other sectors - then by definition we would be left with greater unused resources, i.e., unemployment. Yet the percentage of adults (over 16) with jobs was exactly unchanged from Dec 1996-Dec. 2006 (63.4%).
2. Secondly, why the need for these guesses and hunches? You know, bourgeois economics, whatever you think of it, has produced some extremely rich empirical analyses of the 1995-2005 productivity acceleration.
Try studies by McKinskey - http://www.mckinsey.com/mgi/reports/pdfs/usproductivity/US_Prod_After_Dot_Com.pdf....
...or Robert J. Gordon http://faculty-web.at.northwestern.edu/economics/gordon/Productivity-Brookings.pdf
I'll summarize them for you. The vast majority of the productivity acceleration was due to sharply improved productivity growth in a small number of sectors: retail, wholesale, securities trading, domestic IT hardware production. It was mostly due to technological improvements. It has nothing to do with offshoring low-productivity sectors.
Seth