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Increasing travel costs will hit labour mobility first, then trade in goods, then movement of capital. So I think financial globalisation might outlast free trade.

We have met the enemy, and he is us — Pogo
by Migeru (migeru at eurotrib dot com) on Tue Nov 20th, 2007 at 02:20:31 PM EST
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Not sure I agree. People can move pretty long ways assuming they can build a new life were they arrive (thinking about europeans to the Americas, and the chinese and indians to the areas around the Indian Ocean).

Goods depend on value, luxury items (which is bought for status) has always been traded from afar. But it will make no sense that fish-sticks in my store has traveled around the world first.

Capital, ay there is the rub. For what is capital? In some sense - and possibly the most destructive one in decapitalising economies - it is goods. And thus what applies to goods applies to this capital.

But it is more, the means of production and all of that. Knowledge, skills, social relationships. But can the worlds economies be ruled from a tax paradise in the bahamas connected with high speed communications?

A vote for PES is a vote for EPP! A vote for EPP is a vote for PES! Support the coalition, vote EPP-PES in 2009!

by A swedish kind of death on Tue Nov 20th, 2007 at 02:31:09 PM EST
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That can't be right: there was plenty of labour mobility when the cost of travel was extremely high: see the US in the 19th C.
by Colman (colman at eurotrib.com) on Tue Nov 20th, 2007 at 02:33:06 PM EST
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Sorry: meant Europe -> US.
by Colman (colman at eurotrib.com) on Tue Nov 20th, 2007 at 02:42:04 PM EST
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And plenty of goods mobility and plenty of capital mobility. I'm just making a claim about relative moving costs.

We have met the enemy, and he is us — Pogo
by Migeru (migeru at eurotrib dot com) on Tue Nov 20th, 2007 at 02:42:58 PM EST
[ Parent ]
How do you deconstruct the relative moving costs? Obviously it is different for different goods and different eeehm, kinds of labour? Capital moving costs are very low with computerisation but seem to me more sensitive to the financial and legal framework and their (perceived) stability.
by nanne (zwaerdenmaecker@gmail.com) on Tue Nov 20th, 2007 at 06:21:50 PM EST
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