To answer this question you are supposed to study “Myths and Realities of U.S. competitiveness” by Paul Krugman, Science 1991
Here is Krugman’s thought experiment: Imagine a world in which labor productivity around the world grows at annual rate of 1%, both in the U.S. and abroad. It would seem reasonable to suppose that standards of living and real wages would rise by 1% per year everywhere. Now, suppose that U.S. productivity were to continue its 1% growth rate, but that productivity growth in other countries were to accelerate, say to 4% annually. Would the United States be in trouble?
Summarize Krugman’s answer to this question. Your answer must be at most 300 words. Type your answer.