Reference no: EM131556473

Assignment

Under fair economic regulation in the global world, I do not think global outsourcing is bad. What I mean by the fair economic regulation would directly refer to an economic system without any direct government intervention which is only profiting one nation. As the definition of capitalism, firms naturally following the profit, cost management in this case, is certainly an obvious thing to do. For instance, the concurrent situation of the Donald Trump's policy would be this. Until now, many of the Asian nations benefited enormous amount of profit from international trade, but Trump is arguing this hasn't been fair from U.S. perspective, by imposing higher tax rate on imported goods and etc. Thus, without severe government intervention global outsourcing is not bad. Furthermore, cutting the amount of management cost down by moving their manufacturing factories to other nations, U.S. nations will eventually benefit in the long-run. This would be good from U.S. citizens too, because growth of the firms would eventually circulate the money in inner economy of the U.S. which will end up in increase in the general economic growth of the nation. But global outsourcing may look ugly, because firms are optimizing their cost management by using cheaper labors and resources outside. However, I believe this is a natural things to be done in capitalism. Hence, I believe global outsourcing is an inevitable aspect of the current economy just like the drastic development in AI. I do not think higher corporate tax in U.S. is major encouragement of U.S. firms to outsource, but it is definitely one of the elements causing them to outsource as well. Perhaps, tax adjustment in U.S. might be necessary in the future.