Geoscience Reference
In-Depth Information
Table 3.2
Growth in
shipments, 1997-2011
Exports 46.5
Imports 108.7
Total trade 81.2
Domestic shipments 25.6
GDP 36.6
Source
: Federal Highway Administration and author's calculations
exports, as the United States went into trade deficit, but both imports and exports
grew much more than domestic shipments, with the overall volume of international
trade—exports plus imports—growing three times as much.
So international and interregional trade not only look different, they seem to be
growing increasingly different, and are on different trajectories. International trade
is exploding upwards; interregional trade seems, if anything, to be growing more
slowly than GDP. What might account for that last observation?
3.4
Homogenizing Regions?
At this point in history, we are accustomed to the notion not just that trade is always
growing, but that it always grows faster than income, as the world gets smaller. In
reality, international trade fell relative to world GDP for much of the twentieth
century, not just because of protectionism but also because of a rise in real transport
costs (Estaveodoral et al.
2003
) Still, international trade has risen much faster than
GDP for several generations.
Yet interregional trade appears, at least on a quick examination, to be lagging
GDP growth. What might account for this lag?
One answer is that the Freight Analysis Framework only tracks trade in physical
goods, even as we increasingly become a service economy. It's certainly possible
that interregional trade in services—driven by improvements in communications
technology (hello, Internet) has indeed grown rapidly.
But I'd like to suggest another possibility: maybe U.S. cities and regions have
less reason to trade with each other than they once did. As Kim (
1995
) has shown,
U.S. regional specialization, as measured by the difference in industrial mix, seems
to have peaked circa 1920 and been declining ever since. He suggests that this
decline reflects convergence of factor endowments, which in turn is due to factor
mobility. I wouldn't entirely disagree, but I'd also suggest that technological
change has weakened some of the forces that formerly supported industry clusters.
For example, while thick markets in specialized skills are still a factor in, say, the
concentration of high-tech firms in Silicon Valley, the modern economy may well
have made the labor requirements of different sectors much more similar.
Put it this way: drive across America, and you see many, many seemingly
identical office parks. Within these parks are offices filled with workers in
cubicles—we all work in little boxes, and we all look just the same. (I don't
know about the ticky-tacky aspect.) And maybe that similarity goes deeper than
