· For years economists have dismissed arguments of anti-Gs as hysterical and jumbled (this 2004)
· But we have to look at G critically to make sure it really does work
· Globalisation = growing integration into global economy.
· 2 measures:
        ? Level of restrictions placed on movement of good and services in & out
        ? Relative size of movement of goods and services in & out
        ? i.e. one measures policy and one actuality
        ? These not actually correlated (!)
        ? Eg export subsidies are anti-global by first measure but potentially pro-global by second
                § Hence disagreement on how global East Asia was.
        ? Controversy is over policies, not idea of being integrated. This focus of paper.
        ? Also need to consider economic liberalisation within countries as this one of targets of anti's
        ? If you want FDI you need to do policies foreign investors approve of, ie neoliberal policies.
· Use of "anti-globalisation" label on street protestors denies voice to large portion of population who share concerns
· Actually Naomi Klein etc all embrace idea of globalisation in sense of global movement, etc
· We should use "anti-globalisation" for those who want to stop integration, and "critics of glob" for those who don't object to principle, just reality of way it's being done.
· QUO "Capitalism is the astounding…." p6
· QUO Bayesian learning theory says that we process new information in light of previous views and given number of sources of unknown quality, we choose that which agrees with our previous views.
· Objections to globalisation:
        1. It takes power from weakest to give to strongest, WTO/TNCs
        2. These will act in their own interests, which will mean to the detriment of the poor.
· ROLE of big business in running glob probably the single greatest concern, eg no logo.
· Concern over power of business exists outside glob, but glob enhances in three ways:
        1. Gets richest TNCs into poorest countries who can least resist takeover
        2. Strengthens supra-national institutions that are heavily influenced by business
                i. Eg TRIPS supposed to come from this.
        3. Makes it all worse cos makes big business bigger.
· Proponents say by encouraging openness and accountability by govts, and ending state monopolies, makes corporate takeover less likely (CHECK ?)
· A few recognise it can work either way
· Economists see glob in framework of perfect competition, but of course that absent
· Glob can break domestic monopolies, but can bring TNC oligopoly
· Acceptance of imperfect competition makes it possible to perceive market distortions not caused by governments
· There's no hard evidence that globalisation leads to market concentration but awareness of imperfections in competition is increasing

Concepts of poverty and inequality
Part of disagreement over "poverty and globalisation" is disagreement on what poverty is.

· Key disputes:
        ? Total number of poor vs poverty incidence
                § Pro all use indidence, anti all use number.
                § Pro argue is more accurate, accounts for pop growth
                § Anti have environmental limits, more practical stuff on their side
                § All measures show incidence of poverty, but there's confusion on number.
        ? Monetary vs multi-dimensional measures
                § Antis - and most development economists - use multi-dimensional measures
                § [Important for case to be made in illustrative terms - "Chitra has no food" - and quantifiable measurable ones (HDI etc)]
                § IMP Empowerment, participation, vulnerability to shocks all key.
                § Perceptions of poor of their improvement in condition lag behind actual income change
                § Some measures show improvement measured by incidence, like income figures:
                        ? Eg literacy, life expectancy, infant mortality
                Voice
                § Pro's say glob brings democracy \ Voice, empowerment
                § Anti's say voice & empowerment are first to go
                § Pro's mean formal governmental democracy while anti's look at reality of voice in already "democratic" countries
                Vulnerability to shocks
                § There's evidence of increased voltility through capital account lib
                § There's also evidence of income instability through removal of price supports
                provision of public services
                § Argues reduction in tarriff revenues and SA destroy public services crucial to poor.
                § But little evidence
        ? Level of aggregation
                § Anti's will talk of poverty worsening if some people get poorer, even if total number of poor decreases
                § IMP This a lot to do with lower aggregation levels (hence lack of quantified info)
        ? Time horizon
                § Anti's both shorter- and longer- time view.
                § Shorter: more attention to immediate loss to subgroups, of service cancellation etc
                § Contrasts to economist's medium-term "there will be more jobs"
                § Anti's say "but will they go to the people who used to drive the buses?"
                § Possible Rawlsian / untilitarian approach divide.
                § [What about longer term? ]
                        ? Presumably shift in global power etc
Inequality
Critics more concerned with it than pro's.
· Philosophical concern with "fairness"
· Also practical conerns: may spread terrorism, migration, etc
· Critics of globalisation look at dollar inequality and polarisation, pro's use Gini
· As pie grows, if slice sizes stay the same absolute inequality is increased but Gini doesn't change
· Rich gain many times more from growth than poor - this seems unfair though proportions the same
· Or, workers gain from working at sweatshop, but we still see it unfair that company pockets savings from workers being abroad. [SURELY just say "good but not good enough?"]
· Tendency to use polarization makes inequality seem worse by raising top bar.

Measurement of poverty and inequality
The literature leaves questions of where poverty and inequality are going - and their relationship to glob - wide open
· Poverty
        ? IMP Measures of global poverty ($1.08/day) headcount in 1998 range from 0.35bn to 1.20bn!
        ? Upward trend by $2 measure ten times $1 measure - i.e. number of people below $2 but above $1 is increasing really really fast
        ? But loss of consistency from drawing a new line makes it unwise
        ? Household surveys give lower incomes than national acccounts (still uses HHS for distribution)
        ? Some argue nat accounts more accu, some HHS
        ? Problems with basket
        ? Endless problems with time measurement, with PPP etc p26
        ? Need set PPP line to fix on going forward (and calculate back)?
· Inequality
        ? All this confusion plus one more: global distribution or "between" and "within countries" distributions?
        ? Whole point of globalisation should make "world inequality" more meaningful.
        ? BUT it's the least useful for policy planning
        ? STAT Lovely summary of inequality figures p28
        ? Because China and India grew, but became more unequal within, "world inequality" change lies in between "between countries" measured by pop, and not by pop.
        ? PPP v market exchange, Nat acc vs HHS all affect measure
        ? In partic HHS gives downward trend, nat acc upwards
        ? Ariat PPP gives measure between market and PPP figures
        ? If you took this with largest sample, you'd get inequality increase 1980-93
        
Causation issues
Both sides claim gobalisation responsible whatever they think is happening
· Everyone says Asia suceeded because did what they say, and Africa struggling because hasn't
· Eg glob: Africa too protected; anti - Africa suffering from SA as well as other problems
· Key types of study:
        ? Correlation trade / growth / income / poverty / inequality
        ? Cost of living indeces
        ? General equilibrium studies (!)
        ? Syntheses of these with HHS data.
        ? Micro-economic studies
· Consensus on these points:
        1. Trade is correlated with and source of growth
        2. Growth is overall good for the poor
        3. US and EU should liberalise trade, ie textiles
        4. FDI is correlated with and source of growth
        5. Liberalisation of short-term capital markets is dangerous
        6. Governments need safety nets for losers of liberalisation
        7. TRIPS needs to change
        8. Access to education health and credit are necessary for making sure poor benefit from globalisation
        9. Edu and health should be included in poverty measures (eg HPI)
        10. Excessive corporate power is a problem
        11. Capture of market power by elites is bad for growth and welfare
        12. Political reform is needed in LEDCs
· There is a sign of a middle way developing with Oxfam recognising trade and Economist problems with unbridled capitalism
· Why not stronger consensus?
        ? Endogenity - endless array of variables and no solid external perspective to test against
        ? All the aforementioned meaurement problems, multiplied
        ? Cross-country regression studies popular but have serious problems
        ? Acceptance of more need to study actual causal links between glob and poor
        ? More importantly existing studies haven't really answered people's questions.
                § People don't just want proof that growth or trade benefit poor
                § They want policy proposals for maximising benefits to poor and minimising losers
                § And they want social and environmental sustainability
        ? So not opposing "free trade," but "adoption of free trade by LEDCs with no attendant adoption by MEDCs"
        ? Growth works but growth tempered in certain ways could work better.
        
Summary
Four reasons why people don't think glob helps poor
· Seems to give a lot of power to TNCs whose interests differ from those of poor
        ? Here more research is needed to see what real effects are
· Some people will always lose even if most gain
· Critics look at polarisation not general income dist.
· There are huge issues with poverty and inequality measurement
· Empirical research looking in detail at actual situations says glob v pro-growth but some poor people always pay the price.
        
QUO P. 46-7 dead useful summary of disagreemetns