We must work to make the globalization of the economy work for all of our people. The information age has created new opportunities, but it has also brought challenges. Microchips, the Internet, and fiber-optic cables now connect businesses and consumers worldwide, driving the shift from a traditional manufacturing economy to a new, knowledge-based economy.
—Adapted from a government report on technology and trade, 1997
Which of the following was a primary domestic effect of the transition toward the 'knowledge-based economy' described in the passage?
- AA return to absolute isolationist trade policies that closed off foreign markets
- BThe containment of international trade to prevent the spread of foreign technologies
- A decline in traditional manufacturing jobs and the expansion of the service sectorAnswer
- DA reliance on high federal tax rates and increased economic regulation to stimulate consumer demand
Answer
A decline in traditional manufacturing jobs and the expansion of the service sector
The transition to a knowledge-based economy and the rise of globalization in the late twentieth century led to a decline in traditional manufacturing employment in the United States as companies outsourced production. Concurrently, the service and technology sectors grew rapidly, expanding service-related employment.
Step-by-Step Solution
Key Concept
The shift of the United States economy from manufacturing to service-oriented industries, driven by the digital revolution and globalization.