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The Social Consequences of Economic Globalization

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Dumont M.

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Abstract

If mainstream international trade theories overwhelmingly point out the welfare to be gained by all countries in reducing trade barriers, some of these theories also clearly imply that trade liberalisation is not neutral, e.g. in terms of income distribution. International trade competition, alongside with technological change, has been considered as a possible explanation for increased wage inequality in some industrialized countries. In some recent theories, free trade is shown to be potentially detrimental to technologically lagging countries. If this would be the case, trade liberalisation could actually hamper rather than spur economic growth in developing countries. In this chapter, a critical review is proposed of some theoretical and empirical arguments in favour or in opposition to economic globalisation as a way to reduce the welfare gap between developed and developing countries or as a threat to the social cohesion in (ageing) developed countries.

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Paper provided by University of Antwerp, Faculty of Applied Economics in its series Working Papers with number 2006025.

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Length: 20 pages
Date of creation: Oct 2006
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Handle: RePEc:ant:wpaper:2006025

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  10. repec:rus:hseeco:121595 is not listed on IDEAS
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  21. Robert E. Baldwin, 2003. "Openness and Growth: What's the Empirical Relationship?," NBER Working Papers 9578, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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