**Computer: friend or foe?

As Freeman’s analysis indicates, the theory of factor price equalization fails to perfectly explain the decline in wages of low-skilled workers in the U.S. and the decrease in low-skilled employment in Europe. Acting as a debate-referee, Freeman eventually calls the winner as only a partial, and not even primary causal role for the factor price equalizationists. What really struck me was the idea presented by Wood in the article on how a possible factor in all this is how “trade with less-developed countries induced substantial labor-saving innovation”. Having previously read this paper in Prof. Goldsmith’s social issues class, we discussed at length the relationship people may have with new technologies. Specifically, is it a substitute or a compliment to a given worker? In other words, does the computer help you do your job better, or does it simply do your job? It seems likely that most who find themselves being replaced with technologies would be the low-skilled laborers the article focuses on. Sure, one can point out that X-rays are sent to India and isn’t that replacing a doctor which would be considered a high skilled laborer, and there is some truth in that. However, these are the novel exceptions to the much more prominent issue of the many low-skilled laborers in which we could come up with a much longer list of examples (low-end textiles immediately comes to my mind).
Thomas Friedman, in discussing the concept of globalization and the debates regarding it, once wrote that debating globalization was like debating the sun rising: its going to happen regardless of opinion. One may retort that ‘well, the option of tarrifs and trade barriers makes globalization less inevitable than the sun rising’. Maybe. But as Freeman points out, there is a considerable portion of the public that is firmly in support of free trade and implementing protectionist policies would be difficult.
I also found interesting Freeman’s point about States: even in neighboring states in the U.S. opportunities and wages for low-skilled laborers have varied, which certainly casts doubt on the factor price equalization theory. I suppose my feeling towards the idea of factor price equalization would be that it a based on sound reasoning but as Freeman’s analysis points out, the data just isn’t there to confirm that this is what is happening. Perhaps the complex role of new technologies may provide better insight into the increasing hardship of low-skilled laborers.