Made in the U.S. of China

Eye-opening numbers on U.S. component of “Made in China” products:

Thus, on average, of every dollar spent on an item labeled “Made in China,” 55 cents go for services produced in the United States. In other words, the U.S. content of “Made in China” is about 55%.

via FRBSF Economic Letter: The U.S. Content of “Made in China” (2011-25, 8/8/2011).

Related posts:

  1. China Has a Worse Mortgage Problem Than the U.S.
  2. McDonald’s China Mania: One New Restaurant a Day
  3. Playing the China GDP Game
  4. QotD: China Eyes Canada Oil
  5. Living Downwind from China

Comments

  1. harvey says:

    Eye opening? Suppose the items were actually free (say the Chinese used slave labor who worked for nothing). Then "100%" of the cost/content would be made in USA (using their methodology), once the Chinese distributor put an office in the US.

    We expect this number to be rather high under free trade labor/environmental arbitrage, that is the whole point! Free trade is designed to concentrate the profits into as few domestic hands as possible.

    The fact that a Federal Reserve Bank releases this as an "eye opening" whitepaper is far more interesting, if you ask me. I'd love to know how/why that paper was commissioned, etc.

    • The benefits of free trade are not concentrated in as few hands as possible. Quite the opposite, the cost savings are passed to all who buy instead of concentrated with the owners of industries protected by trade barriers..