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Thread: Imports are the main cause of Unemployment

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    Default Imports are the main cause of Unemployment

    I have been reading The Economist dated 25th March 2012. At the back of the magazine are statistics on unemployment and trade deficits.

    Every country that has unemployment over 8% runs a trade deficit.

    Every country that has unemployment under 4% rus a trade surplus.

    (When I say trade deficit this includes invisibles incomes banking and insurances, and the official title is Current Accout Balance).
    Last edited by SDP; 29-02-2012 at 01:30 PM.

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    A few examples

    USA has unemployment of 8.3% and a trade deficit of 466 billion dollars.

    Britain has unemployment of 8.4% and a trade deficit of 70 billion dollars.

    Italy has unemployment of 8.9% and a trade deficit of 70 billion dollars.

    Colombia has unemployment of 9.8% and a trade deficit of 9 billion dollars.

    France has unemployment of 9.9% and a trade deficit of 65 billion dollars.

    Euro Area has unemployment of 10.4% and a trade deficit of 44 billion dollars.

    India has unemployment of 10.8% and a trade deficit of 65 billion dollars.

    Egypt has unemployment of 11.9% and a trade deficit of 4 billion dollars.

    Greece has unemployment of 20.9% and a trade deficit of 29 billion dollars.

    Spain has unemployment of 22.9% and a trade deficit of 53 billion dollars.

    Souht Africa has unemployment of 23.9% and a trade deficit of 11 billion dollars.
    Last edited by SDP; 29-02-2012 at 01:46 PM.

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    Examples of countries with a trade surplus

    Thailand has unemployment of 0.6% and a trade surplus of 11 billion dollars.

    Singapore has unemployment of 2% and a trade surplus of 57 billion dollars

    Switzerland has unemployment of 3.1% and a trade surplus of 95 billion dollars.

    Malaysia has unemployment of 2% and a trade surplus of 32 billion dollars

    South Korea has unemployment of 3.2% and a trade surplus of 27 billion dollars.

    Switzerland has unemployment of 3.1% and a trade surplus of 95 billion dollars.

    Norway has unemployment of 3.4% and a trade surplus of 70 billion dollars
    Last edited by SDP; 29-02-2012 at 01:57 PM.

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    Very interesting stuff SDP.
    I shall use this information.

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    Quote Originally Posted by SDP View Post
    I have been reading The Economist dated 25th March 2012. At the back of the magazine are statistics on unemployment and trade deficits.

    Every country that has unemployment over 8% runs a trade deficit.

    Every country that has unemployment under 4% rus a trade surplus.

    (When I say trade deficit this includes invisibles incomes banking and insurances, and the official title is Current Accout Balance).
    SDP: To give that more credibility, how many countries do not conform to that pattern? High unemployment despite a trade surplus. Germany, for example, has a 6.6% unemployment rate, while having a 132Bn trade surplus. What definition for being unemployed is used? Are you saying, for example, that all Indians have a job apart from just 10.8% of them? This is the type of nonsense that one would expect to read in the Readers Digest, not the Economist. China has a very good trade surplus, but what unemployment rate do they claim exists in that country?

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    Quote Originally Posted by SDP View Post
    A few examples

    USA has unemployment of 8.3% and a trade deficit of 466 billion dollars.

    Britain has unemployment of 8.4% and a trade deficit of 70 billion dollars.

    Italy has unemployment of 8.9% and a trade deficit of 70 billion dollars.

    Colombia has unemployment of 9.8% and a trade deficit of 9 billion dollars.

    France has unemployment of 9.9% and a trade deficit of 65 billion dollars.

    Euro Area has unemployment of 10.4% and a trade deficit of 44 billion dollars.

    India has unemployment of 10.8% and a trade deficit of 65 billion dollars.

    Egypt has unemployment of 11.9% and a trade deficit of 4 billion dollars.

    Greece has unemployment of 20.9% and a trade deficit of 29 billion dollars.

    Spain has unemployment of 22.9% and a trade deficit of 53 billion dollars.

    Souht Africa has unemployment of 23.9% and a trade deficit of 11 billion dollars.

    Just one point about those figures is that it would make more sense if the trade deficit were expressed as a percentage of total trade because the theory is incomplete otherwise. We could then plot it out and see what we get.
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    Quote Originally Posted by Baron von Lotsov View Post
    Just one point about those figures is that it would make more sense if the trade deficit were expressed as a percentage of total trade because the theory is incomplete otherwise.
    Or maybe GDP.
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    You can look up all those figures on the Google public data website for many countries around the world. There doesn't seem to be any correlation at all between balance of payments and unemployment.

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    Quote Originally Posted by Geoffrey Collier View Post
    SDP: To give that more credibility, how many countries do not conform to that pattern? High unemployment despite a trade surplus. Germany, for example, has a 6.6% unemployment rate, while having a 132Bn trade surplus. What definition for being unemployed is used? Are you saying, for example, that all Indians have a job apart from just 10.8% of them? This is the type of nonsense that one would expect to read in the Readers Digest, not the Economist. China has a very good trade surplus, but what unemployment rate do they claim exists in that country?
    Geoffrey Collier

    No country with unemployment below 4% runs a trade deficit. There were no exceptions.

    China has unemployment of 6.1% and a trade surplus of 201 billion dollars.

    Germany has unemployment of 6.7% and a trade surplus of 188 billion dollars.

    Japan has unemployment of 4.6% and a trade surplus of 120 billion dollars.

    No country with a big trade surplus has very high unemployment. There are no exceptions to that either.

    China has problems of having huge areas of poor people.

    Germany has problems of having open borders to the EU.

    Japan has earthquake and tsunami problems.

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    Quote Originally Posted by ron View Post
    You can look up all those figures on the Google public data website for many countries around the world. There doesn't seem to be any correlation at all between balance of payments and unemployment.
    Ron

    There is correlation

    No-one with unemployment less than 4% runs a deficit.

    No-one with unemployment over 8% runs a surplus.

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