The US And Europe Should Focus On Exporting Business Services

J. Bradford Jensen has been one of the leading proponents of market liberalization and the benefits from globalization. In this article he argues that we should be less concerned about the loss of manufacturing jobs, and more focused on expanding our export of business services. We have a trade surplus in business services today, and the market should expand as emerging nations develop their infrastructure. It is a larger market in the US than manufacturing, and it pays good wages, but it is only a small percent of our export base. The US market, and the European market, have been open to the import of business services but many countries have placed barriers on the importation of business services. He suggests that government should work to open those markets to US exports.

It would nice if the US and Europe could expand their export base in business services. The banking industry has expanded its presence in global markets but its foreign branches have been staffed with domestic workers. We have also been a net importer of information technology services due to the availability of skilled workers who earn much less than US based information technology professionals. Its hard to see how the US and Europe have a comparative advantage in business services that would employ large numbers of domestic professionals.