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Wong 7 koreas government used their ability to

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Wong 7Korea’s government used their ability to compete in the global market as a way to measure theirsuccess in productivity. MacEwan explains the reasons why neo-liberalism does not work in theworld today. First, he explains the idea of technology in economic growth. The idea of “learning-by-doing” is important to the neo-liberal phenomenon. Even while the initial teaching may beexpensive, over time people become acclimated to the new directions. Protecting the newactivity from foreign competition would then make it even more advantageous and morecompetitive. He claims that “different kinds of production activities” lead to different changes inthe overall economic environment. The U.S. experienced “technological externalities” during thetextile boom, which prove to be location specific to the region they are normally made. Duringthe textile industry, there grew a greater demand for machinery, dyes, equipment to move rawand brand new materials, and plenty of new skills to learn how to do all of the above. The townsthat produced the textiles helped with economic growth for the entire country. The second pointis the relationship between trade and employment. The neo-liberal theory suggests “that whenpatterns of trade and production change, labor will move from one activity to another”(globalization 13). The author gives an alternative idea that a majority of low-income countrieswith high unemployment show that the pattern of trade and production effects employment andlabor markets adjust accordingly. The third point is the relationship between free trade and largefirms. Neo-liberalists suggest that if there were minimal to no government regulation forinternational commerce, the global economy would remain competitive with each other. Inreality, “international commerce, however, is often dominated by a relatively small number ofvery large firms that operate in a monopolistic manner” (globalization 14). Big firms tend tomove to regions that offer production at lower resource prices. The fourth problem the theorydiscusses is the issue of primary products, or products that are unmanufactured. The neoliberalist
8standpoint on international division of labor has improved from its initial intentions during the19thcentury, but many low-income countries still struggle with the unstable primary productspecialization. Products like raw sugar, coffee, or cocoa are always in demand but the price ofthe products themselves never seems to fluctuate. For instance, if bananas did not grow from badweather, producers will raise the price but will not to a more reasonable one. MacEwan ties upthe article saying that whoever has power in the deregulated society has the most control over theworkers wages, environment, and hours. Whoever has the power has “the ability to shift moreand more of the value produced y society into one’s own hands” (globalization 16).

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Term
Fall
Professor
RaviBhandari

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