On Mercantilist Explanation For Global Inequality And Poverty

In most cases U.S. citizens who are in poverty are in relative poverty in relation to the rest of the U.S. population; whereas in the world as a whole a greater number of people are in absolute poverty and are barely able to survive on their income, or wages and earnings, and they have very little to no wealth since it is impossible to save any of their money. Ethnocentrism makes it difficult to obtain a clear picture of the conditions of poverty and inequality in other nations and cultures. There are many theories concerning the causes and solution for poverty in the global economy. The two major theories are the modernization theory which explains inequality in terms of technological and cultural difference between nations, and the dependency theory which explains poverty in terms of the historical exploitation of poor, or low-income, nations by rich, or high-income, nations. This theory has manifest itself in a new way in today’s world in the form of neocolonialism; economic exploitation by multinational corporations.

In theory, globalization should help contribute to the equality of the global economy. Yet this is not the case in reality. Globalization contributes to unsustainable prosperity for a very small percentage of the world’s population. For those in developing countries, it is especially unsustainable. The resources in these areas are consumed at an unstable rate and the environment given very little consideration. The workers are treated as if they are expendable. The smaller economies of these countries are vastly taken advantage of. For these reasons, globalization contributes to sustainable prosperity to a small extent.

Socioeconomic status has been known to have a great effect on people. It’s a well-known fact that poverty and inequality affect the well-being and opportunities for families and their children. It is a common fact that people who have accumulated much wealth occupy the top echelons of society and enjoy almost all privileges brought about by their money and social status while the poor have little or no access to these privileges and are often marginalized in terms of education and social services. There are many forms of socio-economic inequality due to racial discrimination in Canada, for example some of the studies I mentioned in this paper show that a wage gap exists between White Canadians and other visible minorities. Despite pay equity

The second topic in the inequality debate is about inequality between nations. This argument discusses whether globalization is responsible for widening the average income gap between rich and poor nations. When inspecting the average incomes of rich and poor nations, the widening income gap does not occur everywhere. Overall, the debate of inequality between nations results show that developing nations working towards globalization and can possibly grow faster than developed nations. Nations that fail to make their way into the global market may become worse off.

A middle-aged man in Mirebelais, in the Central Plateau of Haiti, raises a tattered T-shirt to show a group of blans—the Creole word for foreigners, or whites—his thin stomach, how long it has been since he has eaten. In the sprawling hillside favela of Jacarezinho, overlooking Rio de Janeiro, a 31-year-old single mother with two small children describes how she struggles to get by on $40 a month from childcare work. And in the capital of the richest country in the world, in Washington DC, a homeless man in his late 50s—who is good-natured and suffers from no drug addiction, nor mental or physical disability— holds a cup to passersby each day for money.

According to Richard N (2006), the free movement of goods due to free market or trade has led to globalization. Though the effects have been assumed to benefit all, there is a large inequality among the poor and the rich both within the countries among the nations. Capitalism is contributed to technological advancement, which has then influenced free trade. The uncontrolled globalization has resulted in more developed societies becoming rich. The rich economies are able to exploit the market by producing at lower price due to their level of technology and advancement in research. They are also able to protect their economy through export subsidies and production subsidies to their farmers. This translates to lower prices for their goods in the global market hence controlling it. The poor countries despite having comparative advantage in production of some commodities they also suffer from competitive advantage from the developed countries they are forced to sell their commodities at a lower price than their expected. They suffer a lot in global trade, which is mainly controlled by the wealthier nations. There are regulations, which restrict the flow of goods in the world market from poor societies. This makes

The world is a far more connected place today than 150 years ago. The rapid rate of technological advancement which in turn accelerated international trade has led us to an age where states are politically, economically and culturally interconnected. Now, to many, this seems like a good thing, and in many cases it is: the ability to talk to someone instantaneously from the other corner of the planet, to buy something from china and for it to arrive within a week… are all positive things that stem from globalization, but underneath these superficial changes the world has seen a pretty big economic shift since the dawn of the neoliberal era and the rebirth of globalization. To be able to properly analyze the effect globalization has had on inequality we have to look at how we define it: Most neoliberalists tend to look exclusively at extreme poverty as the reference point for inequality and therefore the only objective to eliminate, in fact the World Bank’s online entries about poverty (http://www.worldbank.org/en/topic/poverty/overview,2016) talk only about the extreme type of poverty, whereas most critics of neoliberalism underline the need for economists and politicians to also focus on relative poverty and the fast growing gap between the rich and the poor. There is also the question of who we are referring to when talking about inequality; inequality can be discussed both at state level and at an individual level.

In the context of globalization, or interaction between people, companies, and governments of different countries driven by international trade, global inequality matters because it parallels the asymmetrical globalization that limits poor countries. This asymmetry only increases the gap between rich and poor countries. Low-income countries have little opportunity to improve because they have inadequate means and opportunities. Inequality affects both economic and social growth and poverty. For low-income countries, the inequality is reflected in poor social and civic institutions. These incapable institutions, in turn, do little to improve conditions. Global market failures and

Living in an impoverished community creates many hardships for these individuals. Hardships such as not being able to pay bills, not getting enough food on the table, not being able to pay medical expenses, and more. Inequality is a real problem in America when it comes to social classes. The inequality has been rising throughout the years. There are many solutions to this problem that have been proposed such as taxing the rich more, or reducing the costs of public colleges, so these people can get educated and get out of poverty. Although this is an issue, some of this inequality is needed in America’s capitalist economy to stimulate productivity and innovation, but not to the extent it is currently. The inequality between classes is necessary, but needs to be reduced.

If we take a look at Cross country studies presented by Harrison we see a different take on globalization. It takes a look at the relationship between poverty, inequality and globalization. Easterly finds that increasing trade integration is associated with Falling inequalities within developed countries and greater

As Americans we see prosperity through a rather narrow viewpoint. When the average American purchases a shirt they do not stop to consider that their clothing is manufactured in a third world country. One third world country that is ravaged by poverty is Pakistan. In Pakistan “85 percent of people live on less than two dollars a day”. That is outrageous considering the fast food culture Americans live in where you spend nearly ten dollars on just one meal. This poses the question why are some countries so rich and others so poor? This question is not an easy one to answer considering the endless circumstances that make countries so rich and countries so poor. A true reality is that governmental and international institutions may not be doing enough to assist countries in need. First world countries can provide third world countries with tools to further their development ,such as making efforts to end world hunger and providing the less fortunate with a quality education.

Poverty is the outcome of economic inequalities that are sustained by the social problems prevalent in our society. The lack of equal opportunities has created social margins where people in crisis are expelled to the economic edge. In a society where members are stratified by wealth and status, those who live in poverty are seen as deservingly powerless and ultimately abandoned to comply with their temporary crises as permanent. Economic segregation reinforces the unequal separation amongst social classes to keep the poor living in poverty. These are people who do not have the means to fix the conditions of their environment, therefore they remain stagnant in a state of submission and dehumanization, while those who are better off act

Secondly, the debate over income inequality effects of globalization focus on two aspects: Inequality within nations and inequality between countries. The first concerns inequality among individuals inside a country. (Wild and Wild, 2010, p. 48) Critics of globalization believes that free trade and global investment within the internalization incite transnational companies to close factories and move them from high-wage developed countries to low-wage developing countries, which increases the gap between office workers and manual workers within rich nations. (Wild and Wild, 2010, p. 48) In addition, many critics including from Bartlett and Steele (1996), two journalists for the Philadelphia Inquirer, believe that depressing wages in developed nations is the result of the large growth in the international labor force joined with the expansion of the global trade brought by the globalization. (Hill and Hult, 2014, p. 23) Moreover, Hill (2014) support Bartlett and Steele opinion as he stated that organizations that outsources its services into lower-cost foreign markets for lower labor costs were contributing to higher unemployment and lower living standards in their home nations. (Hill and Hult, 2014, p. 24) As an example to support those critics we can consider the case of Apple, the multi billions dollar company that operates its factories in China. According to an article of Oster (2017) Apple pays its workers more or less 305 dollars monthly which is less than 2 dollars

One day, my family and I were travelling in our expensive car, fully covered from head to toe in woolens as it was the winter season. The heater in the car was on and I was nicely sipping my warm coffee, headphones in my ears and a book in my hand. As we passed by a village, I saw a slum area. The people were barely clothed and small children were running around naked. They had no proper shelter-only thatched roofs and plastic put together made a 10x10 feet house approximately, if you would call it a house, in which a total of around 12 people lived. I felt very sad looking at their situation. They were so poor, so helpless. Then, questions arose in my mind- why they are so poor. How far is it appropriate to blame these poor people for their own predicament? Have they been lazy, made poor decisions, and been solely responsible for their plight? What about their governments? Why do I have so much and they don’t even have money to clothe themselves? To find the answer to my questions, I decided to investigate ‘Poverty’ and things related to it.

The countries that have experienced high and rising levels of poverty are more often than not, the developing countries that have been marginalised from the process of globalization. Think of North Korea or many countries in Africa. Such countries have insufficient levels of international trade and investment -- not too much. Whether poor countries are poor because they do not trade enough or because poverty stricken countries are prevented from engaging in the global economy, less globalization is generally associated with less development. Ernesto Zedillo, the former president of Mexico seems to have understood the power of globalization when he said, "In every case where a poor nation has significantly overcome its poverty, this has been achieved while engaging in production for export markets and opening itself to the influx of foreign goods, investment and technology -- that is, by participating in globalization."