Re-Manufacturing: 60 Seconds with Niall Ferguson

Big Idea: Economic and Institutional Flexibility

Big Idea: Economic and Institutional Flexibility.  


Harvard historian Niall Ferguson discusses the idea of bringing manufacturing back home to the United States. He suggests that economics will make this shift in production attractive.

In terms of economics, US wages would either have to fall dramatically, eliminating Chinese arbitrage opportunities, or the US Dollar would have to weaken much more than it already has. Ferguson however portrays these as improbable, and also indicates that these are not the only important factors in relocation decisions. 

For Ferguson, not all parts of the US are attractive to investors, which poses a larger problem.  More often than not, companies will have to deal with trade unions, taxation laws, and a lot of red tape.  He believes that if the United States can be flexible and have an attractive market for manufacturing, then the movement back to the US becomes more feasible.

This attractive market includes an efficient legal system.  It is assumed that the US has a good legal system, with strong private property laws and rights.   However, when the rule of law is measured through corruption and criminality in business, along with the cost of litigation and the efficiency of courts, the US does not even fall in the top 30 countries.

Ferguson claims that manufacturing is not simply about whether it is cheaper to produce in the US or abroad, but about whether a specific location offers the right resources, and institutions, which includes the legal system. The US competitiveness score has decreased over the past five years, showing why nobody is in a rush to locate their businesses in the US.

Over the next couple of years, we will discover which one of these theories comes out on top.  Do institutions matter enough to keep production abroad? Or will there be a move back to US production because of economic reasons?

​There are two kinds of failure – but only one is honorable

Malcolm Gladwell teaches "Get over yourself and get to work" for Big Think Edge.

Big Think Edge
  • Learn to recognize failure and know the big difference between panicking and choking.
  • At Big Think Edge, Malcolm Gladwell teaches how to check your inner critic and get clear on what failure is.
  • Subscribe to Big Think Edge before we launch on March 30 to get 20% off monthly and annual memberships.
Keep reading Show less

Why is 18 the age of adulthood if the brain can take 30 years to mature?

Neuroscience research suggests it might be time to rethink our ideas about when exactly a child becomes an adult.

Mind & Brain
  • Research suggests that most human brains take about 25 years to develop, though these rates can vary among men and women, and among individuals.
  • Although the human brain matures in size during adolescence, important developments within the prefrontal cortex and other regions still take pace well into one's 20s.
  • The findings raise complex ethical questions about the way our criminal justice systems punishes criminals in their late teens and early 20s.
Keep reading Show less

Believe in soulmates? You're more likely to 'ghost' romantic partners.

Does believing in true love make people act like jerks?

Thought Catalog via Unsplash
Sex & Relationships
  • Ghosting, or cutting off all contact suddenly with a romantic partner, is not nice.
  • Growth-oriented people (who think relationships are made, not born) do not appreciate it.
  • Destiny-oriented people (who believe in soulmates) are more likely to be okay with ghosting.
Keep reading Show less

Mini-brains attach to spinal cord and twitch muscles

A new method of growing mini-brains produces some startling results.

(Lancaster, et al)
Surprising Science
  • Researchers find a new and inexpensive way to keep organoids growing for a year.
  • Axons from the study's organoids attached themselves to embryonic mouse spinal cord cells.
  • The mini-brains took control of muscles connected to the spinal cords.
Keep reading Show less