On his blog, “The Big Picture,” the author and commentator Barry Ritholtz sends us to a Federal Reserve Bank of San Francisco paper from last summer that makes a point about which many people seem confused: Despite globalization and all that, the bulk of a consumer dollar spent in America falls on American-produced goods and services.

According to the paper, titled “The U.S.Content of ‘Made in China,’ ” “Goods and services from China accounted for only 2.7 percent of U.S. personal consumption expenditures in 2010, of which less than half reflected the actual costs of Chinese imports.

The rest went to U.S. businesses and workers transporting, selling and marketing goods carrying the ‘Made in China’ label.” The reason this matters — or at least one reason it matters — is for the discussion of austerity, stimulus, and all that. I often get comments along the lines of “Well, maybe stimulus worked back in the old days, but now it just means spending more on stuff from China.” In reality, that’s nowhere near true.

Why? For one thing, most consumer spending is on services, few of which are really tradable. For another, even if the thing you buy at Walmart says “Made in China,” the price includes a lot of U.S. valueadded in the form of transportation and retailing costs.

According to the paper’s estimates (available at frbsf.org), the United States is still a country where about 85 cents of a consumer’s dollar is spent at home, one way or another.

And this means, among other things, that the rules of macroeconomics haven’t changed nearly as much as people imagine.

Apple and Agglomeration The recent New York Times article on Apple manufacturing, “How the U.S. Lost Out on iPhone Work” by Charles Duhigg and Keith Bradsher, was excellent, and I’ll have more to say about it when I have the time.

One thing worth noting right away, however, is that the piece is in large part an essay on the economies of agglomeration: “ ‘The entire supply chain is in China now,’ said another former high-ranking Apple executive.

‘You need a thousand rubber gaskets? That’s the factory next door. You need a million screws? That factory is a block away. You need that screw made a little bit different? It will take three hours.’ ” The point is that manufacturing plants don’t exist in isolation; they benefit a lot from being part of a manufacturing cluster, with specialized suppliers and a large pool of workers with the right skills close at hand.

This is the kind of stuff I emphasized in my own work on both trade and economic geography.

The policy implications aren’t as clear as you might imagine.

But more about that when I have time to do it right.

Reader comments from nytimes.com

These expenditure figures are clearly right on average, but I wonder if the percentages are similar at the margin.

Sure, I spend 85 percent of my income domestically, on average. But if I get a $1,000 tax cut, I'm probably not increasing my healthcare expenditures, which are essentially 100 percent domestic. I might buy an iPod or flatscreen television, both of which have foreign components well in excess of 15 percent.

— Victor Matheson, Massacusetts

Mr. Krugman, an increase in income generally results in an increase in discretionary spending. Expenses like rent or housing, utilities, food and basic transportation have a relatively high domestic content.

Discretionary items like clothing, electronics, toys and furnishings have a much higher foreign content.

That’s why a stimulus plan like the payroll tax cut is relatively ineffective. It gives money to people who already have jobs — and a significant portion of those tax savings is likely be spent on discretionary goods (imported items) or put into savings and debt reduction.

Stimulus programs that directly increase production within the United States would have a much higher multiplier effect.

— G. S., Washington State

No level of services consumption (domestic or foreign) will create wealth.

— M., Kentucky

Mr. Krugman, I see your point that stimulus cash can still have significant domestic benefits. However, I think it is important to note that any increase in manufacturing investments could still be going overseas. I hear all these stories about companies re-shoring jobs, but the anecdotal evidence I see first-hand points to continued offshoring. Many companies in manufacturing and retail often only have two choices: Offshore, or be put out of business by competitors who do offshore.

— Name withheld,

Wisconsin All stimulus is not created equal.

Infrastructure spending, for example, has a bigger multiplier effect than tax cuts do. Plus if it is stipulated that a large percentage of a stimulus package is to be spent locally on infrastructure, then the outflow of benefits to foreign firms is reduced.

— D., New Zealand

I once owned a rechargeable flashlight that was made in Italy. But the bulb was made in France, the rechargeable battery was Japanese and the electronic circuitry had some German inscriptions on it. So did my flashlight qualify as Italian, French, German or Japanese? Keep in mind that it was a just a flashlight — a more complex product is bound to have a more complex chain of suppliers in its production chain.

— I. L., Romania