Chapter 2: Winners of Globalization
Globalization is here to stay, one cannot back away from that fact, but today’s new order can be tapped for the advancement of the entire world economy through peaceful economic efforts. Lawrence Klein, 2005; Nobel Laureate, 1980 Globalization is neither good nor bad in itself; in the long-run it is a step towards efficiency; in the short-run, however, it involves all kinds of painful social and cultural adjustments. Every country has to meet the challenge of globalization in its own individual way. Robert Mundell, 2000; Nobel Laureate, 1999 1. GLOBALIZATION: A WELFARE-ENHANCING MUNIFICENT FORCE? The preceding three decades were a period of unprecedented integration of the global economy through trade and financial channels. Economic globalization is regarded as “the most powerful force to have shaped the post-war world” (Frankel, 2006). It became an indisputably vigorous driver of epoch-making structural changes in national, regional and global economies. Some consider it the most powerful transformative force in the global economy. It has been influencing the evolution of several national economies in a consequential manner. It enabled a group of developing economies to achieve what is known as ‘income convergence’. China’s globalization and vertiginous growth – and moving to the center of the global economic stage – is one such example (Das, 2008b). Without denying the challenges and policy constraints that it imposes, it is fair to say that economic globalization is a source of dynamic change and has myriad positive, innovative and dynamic traits. Although this is reflected in the increasing volume and value...
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