When there’s trade liberalization and globalization, there are always winners and losers. It’s not as if everyone is better off. Say if we buy more cheap goods from China, where there’s a larger labor supply and wages are lower, rapid productivity, the jobs and incomes up, work, as in labor-intensive industries like some light manufacturing in Europe or US get displaced.
That’s part of the globalization process. Of course the economic pie is bigger. You could make everybody better off by somehow taxing the winners and transferring money to those who are left behind. But in practice, we never did that.
So initially, the backlash against globalization was from those who were “left behind” or lost because of globalization: mostly blue-collar workers in advanced economies. But then there were bigger concerns more recently about environmental standards. They’re lower in emerging markets. Concerns about labor standards that are weaker in poorer countries.
Source: McKinsey Quarterly
Subjects: Economics | Economy, Environment | Sustainability
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