Globalization and human welfare
Martin Wolf has a concise summary of globalization’s variable effects on the human condition for the past few decades in his Whitman Lecture to the Institute for International Economics last week: If we turn to human welfare, what is our assessment? • Globalization has brought large economic gains to many parts of the world, above ...
Martin Wolf has a concise summary of globalization's variable effects on the human condition for the past few decades in his Whitman Lecture to the Institute for International Economics last week:
Martin Wolf has a concise summary of globalization’s variable effects on the human condition for the past few decades in his Whitman Lecture to the Institute for International Economics last week:
If we turn to human welfare, what is our assessment? • Globalization has brought large economic gains to many parts of the world, above all to Asia, which has successfully exploited the ladder of development created by labor-intensive manufactures. • Globalization has brought about huge reductions in the number of people in extreme poverty. According to the latest World Bank data, the proportion of the east Asian population living on less than a dollar a day at purchasing power parity fell from 56 percent in 1981 to 16 percent in 2001. This is the biggest and fastest reduction in extreme poverty in world history. • The relatively rapid growth of Asian developing countries has almost certainly reduced global inequality among households for the first time since the 1820s. • Globalization has brought big gains to the developed countries as well. Recent work by the Institute for International Economics suggests that the gains to the United States alone amount to $1,000 billion—almost 10 percent of GDP. For the United Kingdom, the gains must be far greater. • Globalization has not worked well for Africa or much of Latin America. For this there are three reasons: the resource curse, persistent protectionism in agriculture, and the weak supply conditions in these countries. In addition, for these countries, the entry of China into the world economy is a massive shock, both positive and, in some cases, negative.
About the only thing I would add is that with regard to economic development, one could say, “________ has not worked well for Africa and much of Latin America” and you’d likely be correct no matter what filled in the blank. And I don’t mean that scornfully, but rather tragically.
Daniel W. Drezner is a professor of international politics at the Fletcher School of Law and Diplomacy at Tufts University and co-host of the Space the Nation podcast. Twitter: @dandrezner
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