Interregional trade is growing much more slowly than international trade

Paul Krugman writes:

…we can measure the growth of each flow from 1997 to 2011, which covers much though not all of the era of “hyperglobalization.” And here’s what I get for percentage changes from 1997-2011:

Exports: 46.5
Imports: 108.7
Total trade (exports plus imports): 81.2
Domestic shipments: 25.6
Real GDP: 36.6

I think this makes sense: the forces behind hyperglobalization — reduced transportation and communication costs leading to vertical disintegration of production — are encouraging mainly long-range trade to save a few percent on labor costs, not shipping stuff between U.S. cities. Interregional trade seems even to be lagging GDP, possibly because our cities are becoming less specialized than they used to be. (What does Atlanta do for a living, exactly?)


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