The genie cannot be put back into the bottle Beet. IT rules. Transportation costs continue to go down, in part because stuff is getting lighter. That is why if you don't create virtuous barriers to entry such as high educational levels, one is destined these days to slowly regress to the median anyway. The US still has an advantage due to the dollar being the reserve currency, but that regime is on borrowed time. The bottom line is that wage levels anyway, if not the standard of living as a whole, is destined for large swaths of the planet to slowly converge, and all the protectionism in the world will not reverse that.
That's funny; China's eastern seaboard, Bangalore, and a few Pacific NICs aside, there is no real evidence of industrial-based convergence. And even in these cases, the statistics are unreliable, at best. If anything the gap between the developed nations and Africa and much of Asia and Latin America has gotten wider in the past 30 years, not narrower. This is why defenders of the Solow model are only able to point to "conditional convergence."
