Local social, political, and economic considerations were largely ignored. Privatization without land reform or strong competitive policies resulted in crony capitalism, large businesses run by organized crime, and neo-feudalism without a middle class. The consequence will be escalated levels of debt, weakened policy credibility and a lot more difficult task of adjustment in the future. Stiglitz argues that IMF policies contributed to bringing about the 1997 Asian financial crisis, as well as the Argentine economic crisis. Also noted was the failure of Russia’s conversion to a market economy and low levels of development in Sub-Saharan Africa. Specific policies criticised by Stiglitz include fiscal austerity, high interest rates, globalisation problems trade liberalization, and the liberalization of capital markets and insistence on the privatization of state assets.
The amount of imports should be reduced in order to prosper national production, and therefore create more working opportunities. All of the mentioned concepts are to attract national business and production in order to create jobs; once foreign products have higher costs, national produced merchandise compete better in the market and therefore the industry grows to create and protect jobs. Secondly, subsidies which sponsor businesses will sponsor some of the businesses in order for them to sell their produce for lower prices than the foreign products so that their produce also competes better in the market. Protectionism also needs higher taxes in order to function properly, and is therefore disliked by many people. More positively, some feminist philosophers contend that globalization has enabled women to claim their human rights by creating «new spaces, institutions and rhetoric where the notion of universal human rights is a powerful justificatory principle» .
Some women who have been unable to find adequate employment in their own countries have turned to labor migration, which we discuss below. Sex work, including child prostitution, has also increased under these conditions . While many countries have liberalized capital markets and eased barriers to transnational trade in goods and services under globalization, most have not eliminated barriers to the flow of labor. Indeed, some affluent countries, such as the United States, have implemented more restrictive immigration policies, leading to the detention and deportation of thousands of undocumented immigrants and the militarization of national borders. Despite these restrictions, however, migration has increased along with other processes of globalization.
- Another possibility to increase employment is to decrease taxes on capital and lowering the standards of wages policies.
- Such changes have caused many hardships for the poor in developing countries but have also created opportunities that some nations utilize and others do not, largely depending on their domestic political and economic institutions.
- Wealthy nations justify pressure on small countries to open markets by arguing that these countries cannot grow rice and corn efficiently — that American crops are cheap food for the world’s hungry.
- The development of technology like video editing software, high definition and 3D have a strong impact on film producer like Walt Disney to helps them in producing the film efficiently.
However, this reduction of transportation costs also has facilitated the international spread of viruses, bringing infectious diseases to all of humankind. The critical turning point – away from this system of trade balanced against national protections – came in the 1980s. Flagging growth and high inflation in the west, along with growing competition from Japan, opened the way for a political transformation.
Democracy aids social stability, empowers the free flow of information, and promotes a decentralized economy upon which efficient and equitable economies rely. Extending IMF and WTO voting rights to developing countries, along with public accountability, would be a good start. One of the major potential benefits of globalization is to provide opportunities for reducing macroeconomic volatility on output and consumption via diversification of risk. However, the specialization of production, based on the concept of comparative advantage, can also lead to higher volatility in specific industries within an economy and society of a nation. As time passes, successful companies, independent of size, will be the ones that are part of the global economy.
Like all aspects of global inequity, access to technology in Africa requires more than just foreign investment. There must be a concerted effort to ensure the benefits of technology get to where they are needed most. In the last two decades, there has been rapid improvement in the spread of technology to peripheral and semi-peripheral nations, and a 2008 World Bank report discusses both the benefits and ongoing challenges of this diffusion. In general, the report found that technological progress and economic growth rates were linked, and that the rise in technological progress has helped improve the situations of many living in absolute poverty . The report recognizes that rural and low-tech products such as corn can benefit from new technological innovations, and that, conversely, technologies like mobile banking can aid those whose rural existence consists of low-tech market vending. In addition, technological advances in areas like mobile phones can lead to competition, lowered prices, and concurrent improvements in related areas such as mobile banking and information sharing.