Chapter 8: Globalisation by Whom and for Whom?
8. Globalisation by whom and for whom? INTRODUCTION The focus of this chapter is the relationship between globalisation and the distribution of income. Who is getting what shares from the rewards of the global economy? Does economic globalisation contribute to a better re-distribution of income or is there is still a role for government and social policy interventions? Advocates of globalisation have argued the case that increased openness of economies; the commitment to free trade and economic growth represented the means for eliminating world poverty. It seems therefore appropriate to ask how the fruits of the world economy are being distributed and who is getting what from the expansion of trade and economic prosperity? Such advocates point to the alleviation of poverty in China and India. However, does the study of per capita income growth provide a sufficient indicator of prosperity and income distribution? Many advocates have argued the case that economic growth would lift all boats and that economic growth is to be celebrated because there will always be trickle down factors that ensure some of the fruits of prosperity will eventually reach the poor. The poor are more likely to benefit from a context of economic prosperity rather than economic stagnation and decline. But is this assumption ‘right’? Has there been a trickle down of prosperity? Have the poor benefited from globalisation? Commenting on the shape of the world economy, the UNCTAD Report (2001) came to the conclusion that the developing economies were in worse shape in 2000...
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