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Document Details :
Title: Economic Globalization
Subtitle: The Political Challenge
Author(s): VAN LIEDEKERKE, Luc
Journal: Ethical Perspectives
Volume: 7 Issue: 1 Date: April 2000
It is the economic buzz-word of the 1990s, it destroys our jobs, it hollows out the decisionmaking power of governments, it even threatens the nation-state as the central institution of western type democracies — `it' is globalization and we are only at the beginning of it. Whether all of this is for good or ill is a topic of heated debate. One positive view is that globalization is an unmixed blessing, with the potential to boost productivity and living standards everywhere. This is because a globally integrated economy can lead to a better division of labour between countries, allowing low-wage countries to specialize in labour-intensive tasks while high-wage countries use workers in more productive ways. It will allow firms to exploit bigger economies of scale. And with globalization, capital can be shifted to whatever country offers the most productive investment opportunities, not trapped at home financing projects with poor returns. In fact, the arguments in favour of globalization differ little from the arguments in favour of a free market in a closed economy.