Click to enlarge.
It looks to me like China's competitive advantage relative to Mexico has peaked. It happened during the Great Recession and we're well below that point now. I can't say with any certainty if the peak is permanent or simply temporary. I am willing to call it an exponential trend failure though.
In any event, I wonder what the savvy Chinese have to say about that?
Source Data:
St. Louis Fed: Custom Chart
As a side note, China's population is roughly 12x larger than Mexico's population.
ReplyDeleteAll things being equal, one might therefore expect that the ratio in the chart eventually becomes 12 to 1.
All things are never equal though. Go figure.
y = sin(x) + x
ReplyDeleteRob Dawg,
ReplyDeleteI gots to has exponentz failure!
y = ke^x + sin(x) + x
I Can Has Cheezburger?
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Emphasis added! ;)