Double the World's Labor Force

If I don't have anything to blog, I could at least past along interesting posts I ran across.

The Harvard law professor Richard Freeman has started a debate amongst others in the New York Times on the relationship between labor and capital. In short his argument is that 1.5 billion workers in the west have been joined by 1.5 billion workers in China, India and other places, double the capacity of labor and undermining the position labor has been having in the past in Europe and the US. Now their workers are better trained, US and Europe also lose their relative advantage very soon.Here is Freeman's argument in full, as presented at a conference of the Boston Federal Reserve Economic conference in June 2006. There are two scenario's, one suggesting that as the baby boomers retire, labor will have a shortage. The other, saying that through globalization the work force in the world has doubled, so the retirement of the baby boomers does not matter that much.Not everybody agrees. One of the questions at steak: is the world really one market, as Freeman suggests.