I have noted, from time to time, how remarkable it is that the economists’ Law of Comparative Advantage comes into play. For example, you look at a label and find that your bottle of apple juice has constituent juices from around the world. But sometimes the reach of this law just hits you and you say, “It can’t be so.”
The latest example occurred for me en route to Boston after my visit to The Health Foundation in London. I had just read an article in The Economist about China’s trade surplus vis-a-vis the United States. A meal was served and I saw that my 100% polyester cloth napkin -- approximately one foot square, plain white with a machine-hemmed edge -- was manufactured in China (see label above).
I admit to being an unabashed patriot when it comes to buying American. In my personal purchases, I look for opportunities to find products comparable to the imports and am willing to pay extra to help save jobs for our citizens.
I know, however, that airlines have to be less sentimental, especially given their scanty profit margins. American Airlines flies all over the world and presumably has the ability to get the best price on a bulk purchase of cloth napkins, and it apparently found that deal in China.
But I have to wonder. Is there no textile manufacturer anywhere in the United States who could have met the quantity, quality, and price requirements of this buyer for this simple product? As there are two parts to this transaction, two questions arise: How hard did AA look? How hard did the US manufacturers try?
In contrast, the olive oil salad dressing for my meal, appropriately, came from Italy. When it comes to food, the Italians always have a comparative advantage.
But, OMG, the small tubes of Colgate toothpaste in the airline’s vanity kit were from Thailand!