Is Globalization Good or Bad

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Is Globalization Good or Bad?

• AG BM 338
• Agribusiness in the Global Economy

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LEARNING OBJECTIVES

• After todays class, you should be able to
• Explain the main economic benefits of
  globalization
• Explain the economic, environmental, and
  political concerns about globalization
• Articulate your own position on globalization

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CONCERNS ABOUT GLOBALIZATION

• economic
• environmental
• political

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ECONOMIC CONCERNS U.S.

• Does trade lead to a net gain or loss of jobs in
  the U.S. and other developed countries?
• Does trade cause a gain or loss of good jobs
  in the U.S. and other developed countries?
• Outsourcing

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ECONOMIC CONCERNS DEVELOPING COUNTRIES

• Is international trade economically beneficial
  or harmful to developing countries?
• Does trade benefit the rich in developing
  countries at the expense of the poor?
• Absolute poverty
• Relative poverty
• Does international trade encourage sweatshop
  labor in developing countries?

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ENVIRONMENTAL CONCERNS DEVELOPING COUNTRIES

• Does international trade lead to pollution
  havens in developing countries?
• Is there a race to the bottom in countries
  environmental standards?
• Does trade lead to deforestation and other
  natural resource loss in developing countries?

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POLITICAL CONCERNS

• Does globalization lead to U.S. hegemony over
  other countries, particularly developing
  countries?
• Does globalization give international
  corporations the upper hand over individuals and
  nations?
• Does globalization give too much power to global
  institutions such as the WTO and United Nations?
• Criticisms from the left and the right

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WHICH COUNTRIES ARE MOST AND LEAST GLOBALIZED?
Measured by trade as of GDP and gross private
capital flows as a of GDP
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MOST GLOBALIZED COUNTRIES

• Top 5 countries
• Belgium
• Finland
• Ireland
• Netherlands
• Singapore
• What do these countries have in common?

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LEAST GLOBALIZED COUNTRIES

• Bottom 5 countries
• Egypt
• Peru
• Rwanda
• Sudan
• Tanzania
• What do these countries have in common?

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THE ECONOMIC CASE FOR GLOBALIZATION DEVELOPED
COUNTRIES

• Globalization leads to a more efficient,
  dynamic, and competitive economy
• Job losses in some industries more than
  compensated for by job gains in others
• Trade lowers prices paid by consumers
• Trade gives consumers a wider array of product
  choices

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THE ECONOMIC CASE FOR GLOBALIZATION DEVELOPING
COUNTRIES

• More globalized countries have higher per capita
  incomes and higher rates of economic growth
• Absolute poverty declines and working conditions
  improve with economic growth
• Relative poverty worsens but then improves with
  economic growth (Kuznets Curve)

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THE ENVIRONMENTAL CASE FOR GLOBALIZATION

• Economic growth is the only way to provide the
  resources needed for environmental protection
• As incomes increase, people demand a cleaner
  environment
• Evidence for an Environmental Kuznets Curve
  for many types of pollution

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IN-CLASS EXERCISE

• In groups of 3-5 people, come up with three good
  things and three bad things about globalization
• Describe what governments, businesses, and
  consumers can do to
• Encourage the good things you mention
• Reduce the bad things you mention
• Present your findings to the class