Automotive Industry: China and US

Paper Summary:

This paper analyzes the question: "Is there correlation between wage structures within the United States automotive industry and the rising amount of outsourced jobs to China?" as it specifically applies to the automotive industry and the potential for shifting employment in automotive manufacturing from the United States to China. The paper explains what the numbers are saying and what the experts are saying on the subject, through a statistical analysis of finance findings as well as a review of literature on the topic. The paper then attempts to counter the sensationalism of those who wish to seek outside answers to the transitional period of economics in America and isolate it in context from the rest of the global economic picture. The paper also provides a clearer understanding of the impact of outsourcing of employment in the automobile industry from the US to China. The paper looks at the employment changes in the US to see if there is a clear correlation between the wage structures in the United States and the increased numbers of outsourced jobs in the automobile industry in China.

From the Paper:

" Within the general literature relating to the economic structure of the global economy there are many statements, regarding the causes of economic phenomena in the US and elsewhere. Economic and finance literature often calls to mind the growing public sentiment of outsourcing as a fundamental concern of the US and other nations, with regard to employment within the US and or any nation in question. The literature makes a point to state that prevailing public opinion often drives sentiment regarding the financial growth of one nation or group of nations as a source of reduction of growth in the source nation."

Sample of Sources Used:

• Bown, C. P., Crowley, M. A., Mcculloch, R., & Nakajima, D. J. (2005). The U.S. Trade Deficit: Made in China?. Economic Perspectives, 29(4), 2.
• Busser, R. & Sadoi, Y. (Eds.). (2003). Production Networks in Asia and Europe: Skill Formation and Technology Transfer in the Automobile Industry. London: Routledge Curzon.
• Chow, D. C. (1998). The Limited Partnership Joint Venture Model in the People's Republic of China. Law and Policy in International Business, 30(1), 1.
• Gibb, A., & Li, J. (2003). Organizing for Enterprise in China: What Can We Learn from the Chinese Micro, Small, and Medium Enterprise Development Experience. Futures, 35(4), 403.
• Goodhart, C., & Xu, C. (1996). The Rise of China as an Economic Power. National Institute Economic Review, (155), 56.

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