Columbia professor Arvind Panagariya speaks at SIUC

Arvind Panagariya began by attempting to clear up what he sees as the primary difficulty with outsourcing – the confusion over what outsourcing actually is.

He reminded the audience that by the year 2015, the number of jobs outsourced – when countries trade labor- would never negatively affect the American economy. He also emphasized that those outsourced often created a surplus of jobs and money within these companies.

Panagariya was the featured speaker at the Third Annual Vandeveer Chair Lecture in Economics 7 p.m. Thursday. He received his doctorate degree from Princeton University and is now a renowned expert on outsourcing. He holds the position of Jagdish Bhagwati Professor of Indian Economics at Columbia University – a position created to honor one of the leading economists in the nation and professor at the same university.

In addition to this position, he is also an author and editor of a number of books on the subject of outsourcing. He has also written and edited technical papers and guest columns for several economic publications including the “American Economic Review” and “Financial Times.” Panagariya has also made several media appearances on both television and radio programs to discuss the matter.

The prominent expert on outsourcing addressed a crowd of approximately 200 during the lecture, which was sponsored by the Department of Economics and the College of Liberal Arts.

To further untangle the complicated issue, he broke outsourcing down into four modes. Though he considers there to be four modes, he focused mostly on the first during his presentation. This mode involves processes such as the Internet, where neither the buyer nor recipient in the transaction are required to leave their environment.

Although not the foremost issue in the 2004 election, outsourcing is something that many people are concerned with because of its effect on the American economy.

Sajal Lahiri, the endowed Vandeveer chair who selects speakers for the lectures, said he wanted to choose someone who was an expert on the issue.

“The question is how the economy works,” said Lahiri, a professor in the Department of Economics. “He explains the topic and does it in layman’s terms.

“People should be interested in what happens with the country’s economy because it affects all of us.”

There are also those who view outsourcing as a means of cutting costs for businesses, resulting in an eventual gain for the company and its employees. Thus, outsourcing has become one of the larger issues in American politics.

Some politicians, including presidential candidate John Kerry, view outsourcing as a process that may take away jobs from Americans. According to Panagariya, outsourced jobs come mainly from nine areas, including architecture, engineering and management.

Of these areas where 57 million are employed, 300, 000 would not be outsourced. He also compared this to a rate of 30 million jobs created and destroyed each year.

Graduate student Paul Melvin said he believes most Americans view outsourcing not as a way to gain money or create jobs, but solely as a loss of American jobs.

“I think Americans probably think it’s a bad thing,” said Paul Melvin, a graduate student in economics. “But on the same token, I think it’s an idea we’re not very educated on either.”