iPhones are hardly 'Made in China'

A recent Wall Street Journal article discusses how global trade is much more complex than our simple trade balance suggests.

iPhones are in fact assembled in China. The wholesale price of an iPhone is $178.96. When a single iPhone is shipped from the manufacturing facilities in China to the United States, that entire $178.96 is considered an import from China and is therefore considered a debit for the Unites States when it comes to our trade balance with China.

The article points out (and gives numbers) that the various components of the iPhone are actually produced all over the world, including computer chips produced in the United States by Broadcom. Japan actually produces the most significant portion of the iPhone: 34% of its wholesale value. Then comes Germany (17%), South Korea (13%), and the United States (6%). China comes in 5th place at 3.4%.

Here is the article:
Not really 'Made in China'. Wall Street Journal, December 16, 2010.

Fuel vs. Food.

The recent tax cut bill, rushed through at the close of 2010, extends a 45 cent per gallon subsidy for including ethanol in fuel. A recent NPR article discusses how this policy affects the price of food.

NPR: Fuel vs. Food

As an economics professor, I find the article woefully void of supply and demand graphs. If this bothered you too, checkout my newest 'PenCast'

To effectively view the PenCast below, click on the orange button on the top to go to full screen, then click the curvy arrow button on the bottom to rotate the view.

ECO 120: Supply Demand Ethanol
brought to you by Livescribe

The Economics of Seinfeld

The Economics of Seinfeld

In plain English please...

The Federal Reserve's Federal Open Market Committee (FOMC) met today and decided to keep their target interest rate, the federal funds rate, between 0% and 0.25%. After every meeting, they issue a brief press release to explain their decision. Unless you study economics for a living though, they can be difficult to understand. NPR decided to translate the FOMC press release, line by line, into plain English.

Here is the link:
What The Fed Really Said

Seminar: John Nunley

Our final seminar of the semester will be this Friday, December 10th. John Nunley will present his work on discrimination on Ebay. We will meet at 3:30 in room 230 141. Please invite your upper division students.

Update: Note the room change.