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World Commission On The Social Dimension Of Globalization

Decent Essays

Globalization is a complex phenomenon which has positive and negative implications. In one of the report by World Commission on the Social Dimension of Globalization, globalization is explained as “there is no point to globalization that reduces the price of a child’s shoes, but costs the father his job”. The chief characteristics of globalisation as explained by World Commission on the Social Dimension of Globalization are international trade, foreign direct investment, financial flows, technology and policy environment. International free trade has become the foundation of neoliberal globalization. The main aim was to promote development and trade. During the 1870s the gold standard was adopted which enabled the capital to move freely …show more content…

But Paul Krugman states that this relationship cannot be quantified.
Trade and income distribution
Income redistribution is one of the gains from trade. But are the gains from the trade too small when compared to the losses suffered by the low income or disadvantaged groups that have little resources or savings with them. Thus distributional effects prove that technological change alone fails to support free trade. The trade causes some activities to shrink and some activities to contract. The whole notion of free trade is not clear since some people gain and some people lose. Redistribution is often the necessary handmaiden of the gains from trade. Due to a fall in demand for exports from the south, industries associated with the export industries will suffer a permanent fall in employment and even if people find other jobs there will be a fall in the income earnings. Advocates of free trade put forward the argument that some people will get hurt in the short run but in the long run everyone will be better off. This has proved to be wrong when we compare our self in the present scenario. The social impact of globalization is not confined to the marginalized countries alone even the developed countries are suffering

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