That component counts towards trade between South Korea and China. When assembled and that phone is shipped to the US, the entire phone counts towards trade between China and the US. Accordingly, that component is effectively counted twice. Depending on the supply chain there could be triple and quadruple counting, thus overestimating the amount of global trade that actually occurs.
Ghemawat also shed some interesting insight on an intensely debated aspect of globalization – immigration. In terms of first-generation immigrants, people born in another country, who have chosen to live in the US, what is this number as a percentage of the total US population? The answer turns out to be 14%. Three surveys taken at about the same time put the estimate of first generation immigrants at between 32% to 42%. So perhaps the movement of people around the globe is less than commonly perceived.
Although immigration is often marked by polarizing views, the U.S. Fertility Rate (defined as total births per woman) suggests it perhaps shouldn’t be quite so controversial. As of 2016, the rate in the U.S. was 1.8 per woman. This is below the replacement rate of 2.1, meaning that we need other sources of people (namely, immigration) in order to maintain our population.
The high-level takeaway is that perhaps the actual impact of globalization may be overstated. But because of the perception that it is so pervasive, it tends to be blamed for a host of ills, including the absence of wage growth within the US. Ghemawat’s view is that technological advances have far more to do with downward wage pressure than globalization and that the benefits of trade dramatically outweigh the pitfall