Quotation of the Day…
by Don Boudreaux
on February 4, 2019
… is from page 622 of Douglas Irwin’s indispensable 2017 volume, Clashing Over Commerce; Doug is here writing about the American economy during the late 1980s and early 1990s as some U.S. trade barriers began to shrink:
The economic adjustments included the response of domestic firms to deal with the intensification of competition. Although many of these adjustments were painful, including the closing of less efficient, higher-cost production facilities and the layoff of many workers, the results were lower costs and greater efficiency. Many firms had to change their product mix, usually by upgrading product quality, such as the semiconductor industry’s shift from producing commodity memory chips to focusing on specialized devices and sophisticated microprocessors.
DBx: Here’s a question to all those who lose their skepticism of tariff-seeking rent-seekers the moment such rent-seekers drape themselves in the flag of national defense: did this shift of American firms from producing commodity memory chips to producing specialized devices and sophisticated microprocessors enhance or deplete the potential might of the U.S. military?
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