Charles Kenny writes:
And growth in the developing world, even if it means that some populous economies may eventually grow larger than the United States, also means that there are more places for Americans to travel in security and comfort, and more places to learn, work or while away our retirement years. Americans can get health care at Bumrungrad International Hospital in Bangkok — accredited by the Joint Commission International, which certifies health-care organizations worldwide — for a fraction of the cost they can in Bethesda. Or their kids can attend college at the University of Cape Town, rated higher than Georgetown University in international rankings but one-fifth as expensive. Or perhaps they can get jobs at one of the new breed of world-class multinational firms based in the developing world, such as Tata or Huawei.
I sometimes think of this issue in terms of the gravity equation and the inward-looking propensities of large countries. Relative say to Swedes, Americans are relatively unwilling to travel abroad, educate themselves abroad, or work abroad. Some of this may be misguided arrogance, and some of it is a rational response from those living in a large, prosperous country and (often) knowing only the global language, namely English. In other words, Americans benefit less (per capita) from the new opportunities abroad than do Swedes. We do benefit to the extent foreign countries generate innovations which make their way to the United States, but so far not so many of those have come from emerging economies. I expect that to change, although when is a very important and underexplored question.
I believe that for many educated but not super-elite Americans the best opportunities already are abroad, but most of that group is reluctant to exploit them, if only for reasons related to personal lifestyles and family connections and a general unfamiliarity with living abroad. We can expect to see more anecdotally-based feature stories on this theme, however. And there is some longer-run elasticity where the underlying American social norms change.
In the meantime, homebody Americans pay more for gasoline, due to the demands from emerging economies, and pay less at Walmart, and otherwise wonder what the fuss is about.
For more on related points, read Charles’s new and excellent book The Upside of Down, not to be confused with Megan McArdle’s new and excellent The New Up Side of Down, a single space can make all the difference in the world.