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Idea: "Country-in-a-country" special economic zone

The reason for outsourcing is usually cheaper labour costs.But the people who are doing this work are actually having a good quality of life. Because in real terms even though their wages are lower ( eg: in Bengaluru, India) compared to a developed country ( eg:USA), the cost of living is lower as well. At same time jobs are lost in USA. If americans unemployed due to outsourcing can go and work in India they have beter quality of life. But this is always not possible ,due to family commitments , distance etc.

My proposal is special economic zone similar to Charter city , but in reverse. This will be in a developed county ( Say USA). To start with set aside a few thousand hectares of land in say florida for this economic zone - call it CIC ( country in country). It will be a replica of eg: Bengaluru. It will have offices, houses,schools, health care , shopping , entertainment , banks etc. The crucial issue it will have indian rupee as currency. With all these similar to the Indian city , the cost of living and working should be on par with Bengaluru. Now companies can establish call centres in these CIC zones. The pay for call centre operatives will be same as in Bengaluru and paid in indian rupees. So from the company's point of view this call centre on american land costs the same as if it were to be in India.

But the people employed here will be americans who chose to move to this mini India in USA. They have jobs, relatively good earnings as cost of living is less with all amenities. Most people would stay and work in this CIC zone say for one or two years and then move on to jobs in america.
It is bringing american jobs to america while maintaining standard of living and cutting through the barriers of currency exchange rate etc.

It appears to be a win win situation.

But I have a feeling that there must be a fundamental flaw in this idea. I hope somebody who knows these things will be able to point it out.

Topics: economics society

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    Nov 11 2012: To find the 'flaw in this idea' it may help to reduce the complexity of your scenario.

    Find the source of the 'purchasing power' of rupee and dollar and 'what' and 'who' defines it.

    This will tell you, why the workforce of 1.241.491.960 Indians is considered 'less in value' than those of 311.591.917 US Americans. You may find, that this difference is more artificial in its nature than it seems to be on first sight.
    • Nov 11 2012: Can you please elaborate on the "purchasing power" and " less in value" or give links where there are discussed in simple terms.?
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        Nov 11 2012: You could have a start here:


        And if I was you, i would not expect those terms to be simple... :o)

        Good luck!
        • Dec 2 2012: it is not simple. I suppose one needs to be an economist to under stand this.
          it would be interesting how cost of living varies on huge ships? CIC is like a big ship moored in the county for long time.
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        Dec 3 2012: You don't have to be an economist to understand that, enough interest would do just fine.

        But if you wan't to understand the scope of your own idea, you should possess this knowledge- :o)

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