Globalization_s Gains Come ..

Globalization_s Gains Come .. - Globalization's Gains Come...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Order a reprint of this article now LEADER (U.S.) MAY 24, 2007 Dow Jones Reprints: This copy is for your personal, non-commercial use only. To order presentation-ready copies for distribution to your colleagues, clients or customers, use the Order Reprints tool at the bottom of any article or visit WEALTH OF NATIONS While Poor Benefit, Inequality Feeds A Backlash Overseas World U.S. New York Business Markets Tech Personal Finance Opinion Careers Real Estate Small Business By BOB DAVIS and JOHN LYONS in Puebla, Mexico, and ANDREW BATSON in Dalian, China PUEBLA, Mexico -- Like millions of other low-wage workers here, Hermenegildo Flores was supposed to benefit from Mexico's decision to open its economy to foreign trade and investment in the 1990s. For a time, he did. As U.S. companies boosted purchases from Mexican factories, Mr. Flores's salary nearly doubled to $68 a week in 2001. Then foreign competition from places like India, Pakistan and El Salvador intensified: Mr. Flores, who sewed pockets onto blue jeans, says his foreman "would go around shouting, 'If you don't work harder, we are going to shut this plant down and move it to Central America.'" Today, Mr. Flores is unemployed, having accepted a $900 buyout in April after the company switched to new machines. A decade ago, the globalization of commerce promised to be a boon to low-wage workers in developing nations. As wealthy nations shed millions of jobs making apparel, electronics, and other goods, economists predicted that low-skilled workers in Latin America and Asia would benefit because there would be greater demand for their labor -- and better wages. In some ways, globalization delivered as promised. But there was an unexpected consequence. As trade, foreign investment and technology have spread, the gap between economic haves and have-nots has frequently widened, not only in wealthy countries like the U.S. but in poorer ones like Mexico, Argentina, India and China as well. Many economists now say that the biggest winners by far are those with the education and skills to take advantage of new opportunities, leaving many lagging far behind. Incomes of low-skilled workers may rise, but incomes of skilled workers rise a lot faster. "While globalization was expected to help the less skilled. developing countries, there is overwhelming evidence that these are generally not better off, at least not relative to workers with higher skill or education levels," write economists Pinelopi Koujianou Goldberg of Yale University and Nina Pavcnik of Dartmouth in the spring issue of the Journal of Economic Literature. Globalization deserves credit for helping lift many millions out of poverty and for improving standards of living Globalization's Gains Come With a Price - .. 1 of 5
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 03/30/2011 for the course WORK 383 taught by Professor Shurman during the Spring '11 term at Rutgers.

Page1 / 8

Globalization_s Gains Come .. - Globalization's Gains Come...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online