Globalization, Trade and Development
International Political Economy: Trade, Globalization & Development
Although 'globalization' has become a controversial buzzword in the past few years, international trade has been an important part of the world economy for a very long time. The 'opening up' or 'liberalization' of most country's domestic markets to trade has occurred gradually over the past 50 years, in large part due to the success of the General Agreement on Tariffs and Trade (GATT), which has now become institutionalized as the World Trade Organization (WTO). Access to other markets brings opportunities, but it also creates vulnerabilities like any competitive market. As trade becomes more open, there will be winners and losers among the producers and consumers in participating (and nonparticipating) countries. Differences among countries in their health, safety, environmental and labor standards are also sources of contention, because they are sometimes perceived as unfair sources of competitive advantage, or because of perceived pressures to harmonize standards and policies across nations. Although increased international trade has spurred tremendous economic growth across the globe—raising incomes, creating jobs, reducing prices, and increasing workers’ earning power—trade can also bring about economic, political, and social disruption. Since the global economy is so interconnected, when large economies suffer recessions, the effects are felt around the world. When trade decreases, jobs and businesses are lost. In the same way that globalization can be a boon for international trade; it can also have devastating effects. What is Globalization? In general terms globalization is an economic, political, technological, and socio-cultural process where the importance of state boundaries decreases and the countries and their people live in an integrated global system. The term has become particularly popular in IPE and in cultural studies.
At the macro level… • • • • • Greater
Although 'globalization' has become a controversial buzzword in the past few years, international trade has been an important part of the world economy for a very long time. The 'opening up' or 'liberalization' of most country's domestic markets to trade has occurred gradually over the past 50 years, in large part due to the success of the General Agreement on Tariffs and Trade (GATT), which has now become institutionalized as the World Trade Organization (WTO). Access to other markets brings opportunities, but it also creates vulnerabilities like any competitive market. As trade becomes more open, there will be winners and losers among the producers and consumers in participating (and nonparticipating) countries. Differences among countries in their health, safety, environmental and labor standards are also sources of contention, because they are sometimes perceived as unfair sources of competitive advantage, or because of perceived pressures to harmonize standards and policies across nations. Although increased international trade has spurred tremendous economic growth across the globe—raising incomes, creating jobs, reducing prices, and increasing workers’ earning power—trade can also bring about economic, political, and social disruption. Since the global economy is so interconnected, when large economies suffer recessions, the effects are felt around the world. When trade decreases, jobs and businesses are lost. In the same way that globalization can be a boon for international trade; it can also have devastating effects. What is Globalization? In general terms globalization is an economic, political, technological, and socio-cultural process where the importance of state boundaries decreases and the countries and their people live in an integrated global system. The term has become particularly popular in IPE and in cultural studies.
At the macro level… • • • • • Greater