Globalization and Human Welfare

1642 Words4 Pages
bulb-icon

Recommended: Effects of globalization on development

International free trade has become the foundation of neoliberal globalization. The main organizations for carrying out free trade are World Trade Organization (WTO) established on 1995, International Monetary Fund (IMF) and World Bank (WB). The main aim was to promote development and trade. Trade has become the lens through which development is perceived, rather than the other way round . The concept of trade evolved right from Adam Smith and David Ricardo who introduced the concept of comparative advantage which compares the productiveness across countries. Here countries make use of their natural resources, climate, skills etc. According to Paul Krugman trade reflects arbitrary or temporary advantages resulting from economies of scale or shifting leads in close technological races. Thus comparative advantage can be created through technological innovations. Globalization is propelled by economics but shaped by politics; the same applies to free trade both in developed and developing countries. Since developed countries focuses on capital intensive goods and developing countries on labour intensive goods especially agricultural commodities, there is always a difference in ‘real’ terms. But developing countries like China, India, Korea has been shifting to manufactured and service products for exports since 1970’s. According to Paul Samuelson trade has a strong influence on income distribution, since wages are smaller for labour intensive goods and in low wage countries this has a major influence on the wages on high income countries when products are exported from low wage countries to high wage countries. But Paul Krugman states that this relationship cannot be quantified. When we look into the current global scenario income ... ... middle of paper ... ...ca and smaller countries who are largely dependent on aid and foreign investment are highly vulnerable. The main variables that seem to sustain growth include more equal income distribution, democratic institutions, openness to trade and foreign investment, and an export structure favouring manufacturing and relatively sophisticated exports underpinned by a competitive exchange rate. We have to move towards a more social system where human welfare and climate change have to be given importance by focusing more on localization since we have seen that globalization has serious repercussions on human well being and ecosystem. What needs to be done is there should be a transformation of the current institutions that govern the politics of globalization. Human welfare needs to be integrated into the system and trade should be fair rather than resort to protectionism.

Show More
Related

  • Analysis Of Naked Economics

    963 Words  | 2 Pages

    In this chapter of Naked Economics, by Charles Wheelan, he describes many aspects of trade. It begins by showing the capabilities of trade and how it affects everyone as a whole. It makes it so that everyone is better off than normal. To put it into perspective, he put the image in your head of how hard your life would be without trade, you would have to make your own clothes, find a way to get/make your own food, make your own car, etc... After showing some of the advantages to trade, he applies it to a global persona and begins to introduce his opinion on how global trade (globalization) makes us richer. One of the key explanations of this point is that trade frees up time in our busy schedule, therefore allowing us to use that freed up

    Read More

  • Globalization, Poverty And Income Inequality

    997 Words  | 2 Pages

    Many people in international Organizations says that globalization promotes economic growth and poverty reduction. On the other hand, there is other group of economists or we can say other people who criticize economic performance of globalization is not according to that but very disappointing. It is argued that the globalization growth effects are not evident but international trade may be better than financial globalization. Now a days, many researchers caught attention regarding reaction of globalization on income inequality. There is a growing concern that globalization may increases income inequality and giving lesser attention on poverty alleviation. It needs to develop more vast and analysis about the effects of globalization on income inequality and poverty. I am writing this short essay to how globalization affects income distribution and poverty. First, I am trying to seek out the globalization development and international trade and its diverse effects on poverty and

    Read More

  • Maquiladoras: Manufacturing Poverty in Mexico

    2612 Words  | 6 Pages

    The trend toward a more globalized market has become increasingly developed in the latter half of the 20th century. Emphasis on world trade has become a dominant figure in almost every Nation’s economy. Between 1970 and 2000 world trade has experienced an increase of almost 370 percent. Concurrently, world GDP increased by 150 percent. Trade is beneficial to Nations because it allows the creation of avenues that aid in efficient allocation of resources (Canas & Coronado). Countries can gain from trade when they specialize according to their comparative advantage. This is, when they create conditions where goods and services can be produced at a lower opportunity cost than in any other country. Along the same logic, countries can also make large profits by taking advantage of another countries comparative advantage.

    Read More

  • United States Trade Policy: Current and Future Role in a Global Economy

    2527 Words  | 6 Pages

    ...ystem primarily responsible for promoting global competition. Free trade also promotes shifts in production so as to fit the “comparative advantage” model. Though free trade is widely practiced concerns with how to regulate free trade, something supposedly unregulated, countries have to subject themselves to the controversial institutions of the IMF and WTO. Fair trade policies while potentially creating smaller markets support workers’ rights in both the U.S. and developing nations. Though the pros and cons of globalization continue to be debated the United States can no longer escape its role in the global economy nor can it impose policies that are detrimental to the United States founding ideals. However policies that play towards the advantages of both free and fair trade could stimulate a healthy domestic economy that is also competitive in the global market.

    Read More

  • NAFTA and Globalization

    589 Words  | 2 Pages

    Globalization over the past twenty has become an issue in many countries. This industrialization of second and third world countries by Western Civilization creates many opportunities for the inhabitants. Not only does it expand trading markets, but also promotes productivity and efficiency; thus improving the country and integrating it into the industrial world. This process not only benefits third world counties, but also industrialized nations by allowing them to export goods to the developing world and increase their profit margin.

    Read More

  • The Devastating Effects of Neoliberal Policies

    1391 Words  | 3 Pages

    Neoliberalism, also called free market economy, is a set of economic policies that became widespread in the last 25 years. The concept neoliberalism, have been imposed by financial institutions that fall under the Bretton Woods such as the International Monetary Fund (IMF), World Trade Organization (WTO) and World Bank (Martinez & Garcia, 1996). One of the famous economists published a book called “The Wealth of Nations” in which he said in it that free trade is the best way to develop nations economies (Martinez & Garcia, 1996). He and other economists also encouraged the removal of government intervention in economic matters, no restrictions on manufacturing, removing borders and barriers between nations, and no taxes (Martinez & Garcia, 1996). The main goal of the economic globalization was to reduce poverty and inequality in the poorest regions. However, the effects of the neoliberal policies on people all over the world has been devastating (MIT, 2000).

    Read More

  • Globalization Hurts the World's Poor

    1384 Words  | 3 Pages

    From an average American's perspective, globalization is a win-win situation for everyone involvedt. But we fail to see the other end of this situation, where lower-class families around the world are faced with troubles. In countries such as Indonesia and India, American companies purposely set up factories and take advantage of the population by giving them wages below minimum wage to manufacture their products. Families are forced to send their children to work in these factories in order to make enough money to survive. When there is only enough money to put food on the table, living conditions are poor and necessities such as clean water are not as available as they are for us Americans. In other countries such as Colombia, the drug trade is prevalent everywhere and is used as a source of income for many farmers who only want to produce crop for money so their families can prosper. Billions in Aid is given from the U.S government to find a different crop to use but nothing is accomplished as drug shipments continue to come in to America and drug crops are still being produced. If we are ever going to make Globalization beneficial for all, there must be a universal effort to employ laws to protect the lower class who can't afford to protect themselves.

    Read More

  • Critical Response On Globalization

    1224 Words  | 3 Pages

    These results change or modify political organizations to be suitable for the needs of global capital. Regions and nations are encouraged to import and export of goods from other parts of the world rather than supplying or manufacturing them in their own homeland. Thus, seeking expensive manufactured supplies or goods from third world countries to import them to the first world corporation’s injunction with the free trade zones of globalization (Ravelli and Webber, 2015). These negotiations raises new organizations, for example, the World Trade Organization (WTO) to aid and supervise both countries to for a legalized trade. However, Neoliberalism amplifies the negative aspects of globalization’s effect on the economy. For example, deregulation, decrease of government benefits, and tax modifications (Bunjun, 2014). Nevertheless, relating these negative aspects to the documentary Made in L.A. (Carracedo, 2007) which is the main issue of increased risk of employment for both the first world and third world countries. In regards to, a switch from full time stable and secure jobs to part time unstable and insecure jobs. This reduces career growth for many employees, which they recognize, and thus switch jobs – where as they may not fit as well (Bunjun, 2014). As a result, globalization causes market inefficiency via labor market segregation and exploitation, unemployment and underemployment, unequal access to employment (Bunjun,

    Read More

  • Is Free Trade Passé?

    1171 Words  | 3 Pages

    Economists generally believe that international trade can improve the standard of living of the trading countries (Wheelan, 2010). However, economists were not completely convinced that the classical trade theory fully represented reasons for trade. The classical trade theory is based on comparative advantage which is the ability to produce a good or service at a lower opportunity cost than others. The nation with the lower opportunity cost in one product will specialize in the production of that one product and trade for the...

    Read More

  • Analysis Of Globalization: Two Visions Of The Future Of Humanity

    1039 Words  | 3 Pages

    Globalization is an interesting issue that concerns researchers and scientists around the world. Although there are obvious differences in cultures, religious believes and traits, people share technology and they travel to different places all the time. Today, the world is more globalized than before, but the question is it going to become more and more globalized? By using social media and by transportation, a person happens to be more acquainted of other people’s cultures and believes. Being acknowledged and interacting with other people and having the access to see global issues, make most of people add to their cultures some characteristics from different cultures, causing a little bit of a change in their principles, that

    Read More

  • Economic Globalization Essay

    1154 Words  | 3 Pages

    However, globalization has effected some developing states more rapidly than others, bringing inequality among developing states, in accordance to the debate that with growth there is inequality in the article “Are Global Poverty and Inequality Getting Worse?” in which Wolf argues “Some countries, regions and people do better than others. The result is growing inequality. To regret that is to regret the growth itself.” (2002). In order to combat this issue of inequality, the developing states must adopt the international institutional policies and trade liberalization policies in order to benefit the state in its pursuit of globalization. This however creates general inequality among developing states with international institutions in place, but the price paid is one of the decline of poverty and inequality inside of the developing state, and finally the development overall economic

    Read More

  • The Importance of Gender in an Organization

    2645 Words  | 6 Pages

    Shaikh, A. (2007). Globalization and the myths of free trade : history, theory, and empirical evidence . London: Routledge.

    Read More

  • Globalization: The Path to Destruction

    1766 Words  | 4 Pages

    Just imagine waking up in squalor, a once prominent society, now a desolate wasteland. All because foreign interest has raped your land of its natural resources and you seen not a cent in profit. Although, globalization is unifying the worlds developed nations and is bringing commerce to nations that have struggle in past years. True, globalization has many positive effects but do the pros outweigh the cons. In this essay I will discuss Globalization ruining the integrity of many countries and also is forcing many undeveloped nations into a bind, and is causing economic distress on some developed nations. Also, due to economic globalization the nations of the world are diluting their culture, sovereignty, natural resources, safety and political system. My goal is not to change your way of thought, but only to enlighten you of the negatives of global economic expansion.

    Read More

  • Globalization Benefits Rich Nations More Then Poor Nations

    1334 Words  | 3 Pages

    Globalization, an important characteristic within the contemporary economic environment, has resulted in significant changes to individual nations in terms of economic development strategies undertaken by national governments. The term globalization refers to the integration of local and international economies into a globally unified political economic and cultural order, and is not a singular phenomenon, but a term to describe the forces that transform an economy into one characterized by the embracement of the freer movement of trade, investment, labor and capital. The drive for globalization has resulted in greater economic growth globally, through the opening up of barriers to international trade, yet this increase in world output is often associated with detrimental effects in relation to the stability of a national economy, being susceptible to the ups and downs of the international business cycle and also both positive and negative effects on the standards of living or quality of life with in a nation.

    Read More

  • Impact of Globalization on People

    1497 Words  | 3 Pages

    Globalization is one of the main aspects in the 21st century. Globalization has brought the world closer; all the things that are happening nowadays are recognized globally even if they happened locally (Buckley). According to Nayef Al-Rodhan GCSP (Geneva Centre for Security Policy) globalization is not a single word or concept. It contains many other concepts within itself. Globalization is composed of different concepts like incorporation regarding the economics, transmitting information or understandings, stability within beliefs, and other concepts (Al-Rodhan p.3). This paper deals with the definition of Globalization, the advantages and disadvantages of globalization, and based on these information the views that to which extend the globalization is beneficial for majority of the world's population. The concept of globalization has changed the whole shape of the world. It has both its positive and negative impacts on people's life. However, by taking both the advantages and disadvantages into consideration we can find that to a large extend globalization is beneficial for majority of the world's population. With the help of globalization the works that were difficult in past is getting easier in today's environment. People are getting closer to each other, which is a product of globalization. Moreover, the knowledge and informations are being circulated in very good way which is a very good sign for having a good and prosperous life.

    Read More

More about Globalization and Human Welfare

Open Document