September 7, 2011
Pros | Cons |
Emerging economies are now more competitive than the U.S in some industries (pharmaceuticals,information technology services, etc.), therefore, millions of people in the developing world have escaped poverty. As a result, there is a world wide market, and people from other countries have more accessto other countries products and services. | The result of globalization is growing disparities in income and employment across the World economy, with highly educated workers enjoying moreopportunities and workers with less education facing declining employment prospects and lower incomes. There is also a threat of corporates ruling the world because there is a lot of power, which is invested inthem due to globalization. Further more, economists have traditionally assumed that people care only about their own consumption, but there is now a body of evidence suggesting that people do hold‘social preferences’. |
Expanding industries and positions generally employ highly educated people, and they are the areas in which the U.S. economy continues to have a comparative advantage and cansuccessfully compete in the global economy. This is an example on how countries can increase their comparative advantage and produce goods and services more efficiently (specialization). As a resultproductivity levels are increase. | Employment in the United States has been affected even more by the fact that many manufacturing activities, principally their lower value added components, have beenmoving to emerging economies. MNC’s prefer to use cheap labor force of developing countries, but they provide their workers with bad and sometimes even awful working conditions. |
Spence, M. (2011).The downside of integrating markets. Business Source Complete, 90(4), 28-41. DOI: 0015-7120
Ravaillon, M. (2003). The debate on globalization, poverty and inequality: why measurement matters....