“Globalization tends to benefit the privileged sections of society and further marginalized those who are already disadvantaged.”
Subtopic: Paper II · Globalization, privilege and marginalisation
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Give the evidence for the statement, then the strongest evidence against, then a distinction that reconciles them.
- Within-country inequality has risen almost everywhere. Capital is mobile and labour is not, so bargaining power shifted to capital and the wage share of national income fell across the industrialised world.
- Milanovic's elephant curve shows the gains between 1988 and 2008 going to the emerging Asian middle class and the global top one per cent, with near-stagnation for the lower-middle deciles of rich countries.
- Conditionality. Structural adjustment imposed deflation, privatisation and subsidy cuts on countries with no bargaining power — Stiglitz's criticism from inside the institutions.
- Asymmetric rules. Agriculture and labour mobility, where developing countries hold the advantage, stayed protected; capital and intellectual property were liberalised.