GLBL ST 1 Lecture Notes - Lecture 7: Offshoring, Neoliberalism, Special Economic Zone
Document Summary
Research and design occur in california in silicon valley (highly paid individuals) Parts are sourced from multiple countries: germany, italy, south korea, taiwan. These parts are shipped to shenzhen, china so that the phones can be assembled together. These phones are then shipped all across the world. As productivity levels increase in the us, we can also see that the real wages have not increased, even if the average wages have risen. Yet, people have been able to buy luxury goods due to the credit & finance. Offshoring: when a company decided to move a part of their production line abroad (e. g. making shoelaces in mexico, can either own that factory or sub-let it) To be near raw materials, reduce costs. To be near other relevant supply firms, e. g. : film production firms are all located in la, they like to conglomerate in one area. To access low taxes/ business friendly regulations, subsidies, laws, etc.
