Customer Reviews

Globalization, Growth, and Poverty: Building an Inclusive World Economy (A World Bank Publication Series)

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The signal to noise ratio in the discussion of Globalization makes it hard to sort out what is really going on. Much of the discussion comes from anecdotal evidence or from a particular point of view. Of course, it is impossible to be completely objective about anything, but since the mission of the World Bank, the publishers of this study, is "a world free of poverty" it's point of view at least attempts to not view globalization from the perspective of any particular nation or group and to represent different views.

The result is a strongly documented case for the beneficial effects of our increasingly globalized world. This books is a good reference books with facts about the distribution of income, poverty rates throughout the world, changes in GDP over time and other things that are frequently misrepresented by anti-globalization folks.

The book covers many things that are in books like The Lexus and the Olive Tree, A Future Perfect and so on about how the legal and social structure affect investment and growth. This book references the original studies and is a good starting point for research.

It also points out that the forces towards globalization, better communication, transportation and financial markets can easily be stopped in their tracks by trade wars as happened in the 1930's so educating oneself about the benefits of an integrated world economy can help make sure we do not have a repeat of the Great Depression.

I should say up-front that I disagree with the perspective of the writers--I am a firm opponent of neoliberalism (the current form of globalization. Please note, those of us in the global justice movement don't oppose globalization--we just want a different form of it.) I read this book hoping to find someone making a strong case for globalization, so I could understand the other side of the debate--both out of respect for my opponents and because it's always good to know thy enemy. Certainly, the arguments in here are much stronger than in Friedman's /The Lexus and the Olive Tree/ or Bhagwati's /In Defense of Globalization/, both of which are pretty fluffy. Collier and Dollar use statistics to support their position and lay out a much stronger intellectual framework than Friedman or Bhagwati in making the case for neoliberalism. They probably make about as strong a case as you could hope.

The core of their argument is that as countries integrate into the global economy, average income goes up. They also point that as countries integrate into the global economy, they tend to move from agricultural exports to manufacturing. On the face of it, this sounds good. But other things in their own book undermine this rosy picture. On pg. 49, they mention--only in passing--that this increase in income occurs only on average among third world countries--and that low-income countries actually see their average income go down when they integrate into the global economy. Oops. And then there's the fact they note that much of the rise of income goes to the well-educated, professionals and managers. Certainly, that would raise the average income--but a rise in average income doesn't mean the benefits are evenly distributed and, as they themselves admit, it seems to be going disproportionately to the already affluent--not the factory workers. Oops.

Then there are things Collier and Dollar don't deal with in the book that are also highly inconvenient. For instance, the reason agricultural exports go down with global integration is that third world countries get flooded with cheap food imports from first world nations, where agriculture is subsidized. Farmers producing for local markets are put out of business as a result. Collier and David note that people are moving in large numbers from rural areas to urban areas to work in manufacturing, citing this as proof that people embrace globalization. The problem is that a lot of these people don't have any choice. And they're moving from farms to urban slums, where--if they are luck enough to find work--it's in a sweatshop. While I certainly have no desire to romanticize small farming in the third world, the quality of life is still a lot better than living in a slum and working in a sweatshop. Of course, when you move from a small, rural farm to the city and begin working in a factory, your income does go up, at least as it registers in the World Bank's statistics. That does not equal an improvement in quality of life.

Collier and Dollar wave around some impressive sounding numbers, but once you put them in context, they don't look so good. The heart of their argument has holes you could drive a Mac truck through. The rest doesn't really matter. It was a nice try, but they just couldn't pull it off. Sorry guys.

It is a good book, yet i find that i disagree with the author in many places.