Globalization and Poverty

Overall Rating: star ratingstar ratingstar ratingstar ratingstar rating[5/5]Total Votes [ 2 ]  
Rate this page:
Globalization has always been the stepping stone among the topics that revolved around economy and fiscal policy. The effect of globalization on every strata of our social, political as well as economic environment is such that every advocate indulges in analyzing its benefits as well as dangers. There are several analysts, who in particular, compared the relation between globalization and poverty and how one decides the fate of each other.

Different Views on Globalization and Poverty

There are many scholars who hold the view that globalization and poverty share a complex relationship. This very fact can be attributed to the availability of the indirect evidences that depict their link. The one aspect which clearly signifies their positive inter-relation is the consolidation of developing economies via trades and services sector. One can easily notice the steady fall in the world poverty rate if this aspect is taken into consideration.

However, the existing evidence is not sufficient to support the relation between globalization and poverty in the positive light. Many believe that globalization has been a potential cause of rising inequality and that the poorer class does not always get to experience benefits from trade, especially the unskilled workers.

But, again some offer a distinct view to this. They uphold that globalization helps unskilled labor enjoy greater access to markets, which is possible when a contracting economic sector is transformed into an expanding one. This view can be supported by giving examples of nations like India and Colombia. Further, the poor can share their gains if they are furnished with credit and technical knowledge. Proper food aid and income support also plays a major role in this.

Some evidences indicate that foreign investment and increase in export have been able to decrease rate of poverty from many parts of the world including Poland, Mexico and, not to forget, India.

One issue that has been raised against this is regarding currency crisis, which makes poor classes suffer the most.

Conclusive views on Globalization and Poverty

Parameters may vary and sometimes people might think that to be insufficient to prove a strong link between globalization and poverty, yet there are some experts in the field of economy who believe that both the phenomena go hand in hand. The success rate is mainly dependent on the right application of efficient trade and investment reforms.

Last Updated on 5/18/2011