Thursday, January 26, 2012


Claims about the morality of globalization, tend to revolve around the global income gap. To make your case, students should provide data (see my Guidelines).

Carolyn Cannafax wrote

'For globalization to succeed as an integrative rather than a divisive force, it cannot be formulated as a zero-sum game, or ultimately there will be no winners. Failure to instigate the necessary transformation throughout the international political economy will reformulate its governmental and corporate leaders as victims of their own malfeasance. All are subject to the same environmental degradation, social chaos and economic attrition, regardless of their economic, societal, or political positions.'

Her evidence of the zero sum game is the widening gap between rich and poor.

This 'gap' is subject to controversy. Anti globalists tend to assume there is a widening gap, whereas pro globalists want to believe the gap is narrowing.

It is not controversial that the US is experiencing a widening gap. reports the following:

"A widening gap between rich and poor is reshaping the U.S. economy, leaving it more vulnerable to recurring financial crises and less likely to generate enduring expansions.

Left unchecked, the decades-long trend toward increasing inequality may condemn Wall Street to a generation of unimpressive returns and even shake social stability, economists and financial-industry executives say. "

China, India and other Asian countries, as well as Sub Sahara Africa have seen a widening gap. Whereas, it has been argued that the gap appears to be narrowing in other parts of the world. But as we see in Week 1, INTL 5400, units of measurement of national wealth are controversial.

Here is an interesting article focusing on the debate about income inequality:

Key quotes from the article:

"The September 2004 issue of the prestigious American Journal of Sociology carries an article entitled ‘Accounting for the Recent Decline in Global Income Inequality’ (Firebaugh and Goesling 2004) arguing that global income inequality has declined in recent decades as a result of economic globalization. Firebaugh and Goesling’s main arguments revolve around rapid industrialization in the densely populated regions of China and India.

Robert Wade of the London School of Economics, a notable contributor to debates about global inequality (Wade 2004, 2001) shows that Firebaugh and Goesling’s conclusion of falling inequality is sensitive to a series of choices about measures (how incomes are compared, populations weighted, inequality measured) and data (based on national income accounts or household surveys). When alternative choices are made, global income inequality may increase rather than decline."

Probably sealing the deal, is the discovery that the World Bank got its figures wrong in 2008.

"Contradicting the Bank's celebrated decline in extreme poverty figures last year to less than a billion for the first time, the new measurements revealed a far less optimistic outlook - a total of 1.4 billion poor people in 2005,[1] revised from 986 million in 2004.[2]  A margin of error, in other words, of 42 percent, defining a quarter of the developing world as living without sufficient means for human
survival. "

No comments:

Post a Comment