Look at this map. Who then can expect a trade deal between China and the USl The real question is about techno leadership? Huawei has a step ahead of the US.
The Chinese company already has deep discussions with many countries throughout the world. From Asia to Europe, Africa and Latin America the Chinese web is already impressive. On the other side, the US has forbidden purchases of infrastructures coming from Huawei. Australia, New Zélande, Japan and Taiwan follow the same rule. But it is a minority.
Recently, the US has generate pressure on Germany to forbid the German to buy Huawei products in the renewal of their mobile network. Germany has not changed its mind and has allowed Huawei to compete.
The balance of strength at the global level may change rapidly at the expense of the US.
How to expect an agreement that would validate the dominance of one over the other? From China to the US?
In a recent speech, March the 13th, Mario Draghi the ECB president explains the link between monetary policy and technological changes perceived as sources of productivity improvements.
This might at first glance seem an unusual topic for a central bank conference, since monetary policy principally operates through the demand side of the economy. But the long-term supply picture evidently also affects our ability to deliver on our mandate.
Much of the debate today about the true level of the real equilibrium interest rate, for example, is a debate about the outlook for productivity growth, which of course depends in large part on innovation and entrepreneurship. Higher productivity growth is also vital to safeguard Europe’s economic model of high wages and social protection, and hence to counter the sense of economic insecurity that is currently prevalent in several advanced economies.
Read the speech here
After the publication of their book, the Second Machine Age, Andrew McAfee and Erik Brynjolfsson give an interview on their thoughts on the acceleration of technical progress and its impact on the economy, on the labor market and on education.
The first industrial revolution was an automation of physical tasks (steam machine). It helped to reduce physical efforts.The current industrial revolution is a cognitive revolution where due to rapid acquisition and accumulation of information, the machine can decide in place of men.
This will change dramatically the forms of labor. The two authors say that the change will probably go faster than what we imagine. We will have to be reactive and proactive.
For information, visit their dedicated website http://www.secondmachineage.com/
Industry is generally seen as a source of employment on a large-scale. This is often, at least implicitly, the reason to highlight the need for an industrial policy. It does not work like that now. Manufacturing activity grows but creates very few jobs. New technologies have taken over the production system, highlighting trends already evident for many years.
The American example illustrates this phenomenon. The rebound in industrial activity has been strong without creating a lot of jobs. It is this dynamic that must be now understood when we look at the manufacturing sector. Europe will not escape this. Continue reading