
Winners and Losers of Globalization (2012) - gwern
http://www.theglobalist.com/the-real-winners-and-losers-of-globalization/
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lordnacho
Well I see one simple explanation for this. By simple, I mean short, rather
than uncomplicated.

It's easy to move capital, but it's hard to move labour. That's the world
we've built.

So what are the main conclusions?

1) The very wealthy are much wealthier 2) The somewhat wealthy are no better
off 3) The formerly very poor are now much less poor.

Why would that be?

If you're a business, you can move your production to China (of course that
gap has moved in a lot over the years). So as the owner you reap the profits
of mobile capital.

The poor folks in China benefit as well, as they now have better paying jobs
utilising the moved capital. They benefit a lot, but actually they would be
better off if they could participate in the Western labour market. They can't
just come here, so they make do with what opportunities they have. By
experience a fair few of these people are just as useful as anyone in the
West, but that's how the world is built.

The "somewhat wealthy" are the Western middle class. They don't own the
capital, the best they can do is hold on to some of the managerial roles if
they're upper middle, or lose their jobs if they're outsourced. Since the
firms are more profitable having moved production, the managers can do
allright, but they're not all buying yachts. The factory workers in the West
are a bit buggered. They whole point of moving is to avoid their expense. A
lot of people have had to find new things to do.

~~~
force_reboot
I think there is broad agreement for you explanation across the political and
economic spectrum. In management/MBA speak they refer to the change that is
occurring as "climbing the value chain". Each nation must apply its labor to
higher value-added industries in order to improve it standard of living. This
might seem like an impossible task, but there is no in principle reason why
most Chinese coal miners might not be cancer researchers in one generation. Or
most Western shelf stackers might not become programmers.

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chroem-
It's funny, because all of the countries which have done extremely well
(China, Brazil) have protectionist economies while the countries that have
stagnated or suffered (US, EU) have fervently implemented free trade policies.
Hell, the US even had a protectionist economy from the founding revolution to
the mid 20th century as part of the American School of economics.

It's time to critically reevaluate these free trade policies and what they're
really doing, not what we're told they're supposed to do.

~~~
yummyfajitas
Similarly, we should prevent NY based companies from purchasing Salesforce and
Oracle, in order to foster the creation of local competitors. And California
should prevent their tech companies from making use of NY-based investment
banks when they go public.

That's the way to prosperity!

~~~
chroem-
That's a complete and blatant misrepresentation of what I am saying.
Empirically, countries that have not put all of their eggs in the proverbial
free trade basket have been much more prosperous than those that have. You
can't deny that.

~~~
cba9
> ...all of the countries which have done extremely well (China, Brazil) have
> protectionist economies while the countries that have stagnated or suffered
> (US, EU) have fervently implemented free trade policies....Empirically,
> countries that have not put all of their eggs in the proverbial free trade
> basket have been much more prosperous than those that have.

Are you saying that Brazil and China are wealthier than the US and EU?

I also think that this is a curious way to describe China's recent history in
going from Mao to Deng...

~~~
chroem-
The article is about how different countries and demographics have fared over
the last few decades of globalization. Countries like Brazil and China have
experienced massive relative increases in wealth while other wealthier
countries (who also happen to firmly be on the free trade bandwaggon) have
stagnated or declined.

~~~
cba9
So your point is that capitalist countries became much wealthier and they also
did this much earlier than protectionist countries did, and this is somehow a
bad thing about free trade?

------
sooth
Not sure what value there is to gain from this article.

Income distribution is only one aspect of globalization and is probably the
worst measure for where the wins and losses fall. And, as I see it, when you
look at income distribution, alone, the results are quite obvious are they
not?

~~~
derriz
The effect on income is "the worst measure for where the wins and losses
fall"? I'm guessing that the billion or so people who have escaped absolute
poverty in the last 20 years do not share your attitude that income is
irrelevant. Which measures do you think are more important - given i believe
that the wellbeing of all mankind is a pretty important concern.

~~~
sooth
Environmental change for one. example Syria losing half its agriculture land
due to climate change has a lot to do with their poverty increase which then
has other downstream consequences (ISILs numbers grow -> more terrorism ->
increased military spending -> govts invasion of privacy). Add on that the
shoe has yet to drop for most consequences related to climate change - yet
it's still real and happening today.

Add to that culture and knowledge exchange effects and I'm pretty sure income
distribution, while easily measured, would not be towards the the top.

