By Susan Margaret Collins, Carol Graham
How is globalization associated with worldwide poverty and to international inequality? Such questions are on the heart of a heated and, now and then, acrimonious debate, regardless of the big and turning out to be literatures in economics and different disciplines. This quantity of the Brookings alternate discussion board goals to summarize what's recognized from the prevailing physique of scholarly examine and determine the questions about which there's much less conclusive proof and consensus. the talk is additional fueled through the absence of agreed-upon definitions of globalization, poverty and inequality. but clarifying the best way such phrases are used is important, as reviews in response to diversified definitions of the phrases yield starkly contrasting conclusions. All members grapple with this tough factor.
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Extra info for Brookings Trade Forum, 2004: Globalization, Poverty, and Inequality
Here again, the value judgments made about what “inequality” means have considerable bearing on the position one takes in the globalization debate. ”50 Given existing inequality, the income gains to the rich from distribution-neutral growth will of course be greater than the gains to the poor. In the above example of two households, the income gain from growth is ten times greater for the high-income household. To say that this means that the poor “share fully” in the gains from growth is clearly a stretch.
Rather, they are two different concepts. The revealed preferences for one concept over another reflect 51. Chen and Ravallion (2004b). 52. Fields (2001) notes that absolute inequality exists as a concept, though he quickly moves on to focus solely on relative inequality. 22 Brookings Trade Forum: 2004 implicit value judgment about what constitutes a fair division of the gains from growth. Those judgments need to be brought into the open and given critical scrutiny before one can take a well-considered position in this debate.
Critics of globalization, by contrast, appear often to be more concerned about what we can call the horizontal impacts, such as when they point to the fact that there are losers among the poor, even when the net gains to the poor as a whole are positive. 29 27. Maddison (1998); Wang and Meng (2001). 28. See, for example, Dollar and Kraay (2002). 29. For further elaboration of the various concepts of horizontal inequality found in the literature, see Jenkins and Lambert (1999). Martin Ravallion 13 A conventional poverty or inequality measure implicitly attaches weight to both horizontal and vertical inequality.
Brookings Trade Forum, 2004: Globalization, Poverty, and Inequality by Susan Margaret Collins, Carol Graham