Has globalization transformed the pattern of global poverty and Essay

Has globalization transformed the pattern of global poverty and inequality In what ways - Essay Example Based on the assumption that comparative advantage of nations can offer countries an advantage over others, open markets and liberal trade can result into improved trade as well as capital flows and thus help improve the poverty and achieve economic prosperity. It is generally argued that Globalisation can reduce poverty if nations follow the open liberal policies and focus upon achieving sustained level of trade with developed countries. However, considering the inherent differences between developed as well as developing countries, it is also suggested that whether the distribution of flows generated as a result of Globalisation is fair or not. Inequality is also considered as another important issue regarding Globalisation (Moseley and Gray, 2008). This paper will argue and discuss as to whether Globalisation has actually resulted into transformation of poverty patterns and inequality and if yes, in what ways it achieved both the ends. Globalisation, Poverty and Inequality Globali sation is a relatively diverse term as it not only suggests an integration of ideas, products and economic flows but also signifies an integration of the culture also. ... Globalisation essentially suggests that poor as well as rich countries can actually trade with each other as poor or developing countries are considered as abundant in raw materials as well as cheap labor. Large global organizations, due to their sheer size as well as the improved communication and transportation infrastructure, can actually establish their manufacturing facilities in developing countries and subsequently transport back the finished goods to their own parent countries for subsequent sale. The overall economic logic is based upon the assumption that developing countries not only have the cheap and abundant raw materials but also have the cheap labor. Combining this two, it is assumed that it becomes relatively more cost effective for the global organizations to actually trade with poor countries (Goldin and Reinert, 2007). Poor countries on the other hand allow developed countries to enter into their countries with the assumption that such trade will generate employme nt, improve the level of skills of their workforce and will also result into transfer of technology to them. Apparently, Globalisation promises an equal access to the market for everyone, improve capital flows and ensure development and transfer of technology however, the actual results may suggest a widespread economic divergence between the developed as well as developing countries since the Globalisation forces started to dominate the economic policy making in countries (Kaplinsky, 2005). The overall evidence regarding the impact of Globalisation on poverty as well as inequality is relatively diverse in nature. There are two important cases in point which suggest that