August 5, 2005
outsourcing etc.
Brilliant post from Sig: “The Logic Of Outsourcing”.
Whirlpool’s top-of-the-line front-loader washing machine retails for $ 1.200. It’s produced in Germany where the hourly wage is $ 32. In the US it’s $ 23, in Mexico $ 3, and in China it’s $ 1.
And Whirlpool has factories in all four places.
The interesting thing is that only one — 1 — hour of such manual labour goes into the $ 1.200 machine.
Humans like to overestimate the importance of things they can control etc.
[Disclosure: Sig and I work together on the Thingamy project.]
Sig makes a great argument against the outsourcing of manufacturing to