Tuesday, May 29, 2007

What's So Great About Trade Surpluses?

To those who believe a trade surplus should be the objective of policy, take a look at Japan and Germany. Both have had large and persistent trade surpluses for decades. But for the better part of the past two decades, Japan has experienced anemic economic growth. Germany, during the same period, has had mostly double-digit unemployment. Meanwhile, the United States, with its large and growing deficit, has experienced steady, consistent economic growth and job creation over the same period.

~Daniel Ikenson from Cato


At 6/09/2007 1:45 AM, Anonymous Anonymous said...

But when you throw China into the mix, the whole "trade surplus=anemic growth" line of reasoning kinda goes out the window now, doesn't it...


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